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How much is the estimated before-tax cash inflow to be

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Payback Company is considering the purchase of a copier machine for P42,825. The copier machine will be expected to be economically productive for 4 years. The salvage value at the end of 4 years is negligible. The machine is expected to provide 15 percent internal rate of return. The company is subject to 40 percent income tax rate.

The present value of an ordinary annuity of 1 for 4 periods is 2.85498.

Question 1: In order to realize the IRR of 15 percent, how much is the estimated before-tax cash inflow to be provided by the machine?

Reference no: EM132576683

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