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Determine the cash payback period for each proposal

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Reference no: EM133121516

Question - Proposals L and K each cost $500,000, have 6-year lives, and have expected total cash flows of $750,000. Proposal L is expected to provide equal annual net cash flows of $125,000, while the net cash flows for Proposal K are as follows:

Year 1

$250,000

Year 2

200,000

Year 3

100,000

Year 4

90,000

Year 5

60,000

Year 6

50,000

$750,000

Required - Determine the cash payback period for each proposal. Round your Proposal K answer to one decimal place.

Reference no: EM133121516

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