Determining the payback period of doris company

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Reference no: EM13144077

Doris Co. is considering purchasing a new machine which will cost $200,000, but which will decrease cash expenses each year by $20,000. The useful life of the machine is 10 years. The machine would be depreciated straight-line with no residual value over its useful life at the rate of $20,000 per year. The payback period is

a. 5.0 years

b. 4.0 years

c. 10.0 years

d. 4.5 years

Reference no: EM13144077

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