Determine the payback period for wood products company

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Problem 1: Payback Period Calculation. Wood Products Company would like to purchase a computerized wood lathe for $100,000. The machine is expected to have a life of 5 years, and a salvage value of $5,000. Annual maintenance costs will total $20,000. Annual net cash receipts resulting from this machine are predicted to be $45,000. The company's required rate of return is 15 percent. Determine the payback period for this investment using the format shown in.

Reference no: EM132771144

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