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Calculate the payback period for the proposed investment

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Reference no: EM132766793

Sydney Printer Ltd is attempting to evaluate the feasibility of investing $200,000 in a new printing machine with a five-year life. The company has estimated the cash inflows associated with the proposal as shown below. The company has 10% cost of capital.

Year Cash Inflows
1 $30,000
2 $55,000
3 $53,500
4 $61,500
5 $51,000

Required:

a. Calculate the payback period for the proposed investment.
b. Calculate the discounted payback period for the proposed investment.
c. Calculate the NPV for the proposed investment.
d. Would you, as a financial advisor opt for this investment? Why? Why Not?

Reference no: EM132766793

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