to calculate unrecovered investments
I am working on an example problem. I noticed that the cash flows are different every year. So I set up a schedule to calculate unrecovered investments. I came up with 6.5 years as a payback period, but this was marked incorrectly. So I am wondering what I did wrong.
Attached is the Excel workbook with my calculations. If you can give me a detailed explanation, that would be appreciated.
Given: The management team of Aramak, a company, would like to invest in a mul±purpose with the following cash Fows: Year Investment Cash ²low My response 1 75,000 6,000 2 7,000 12,000 3 18,000 4 17,000 5 20,000 6 18,000 7 16,000 8 14,000 9 10,000 10 13,000 1. Determine the payback period of the investment. (Round your response to 1 decimal place) Payback period Years My work The management team of Aramak, a company, would like to invest in a mul±purpose with the following cash Fows: Year Investment Cash ²low Unrecovered Investment 1 75,000 6,000 -69,000 Investment is the ou³low and cashFow is the inFow. 2 7,000 12,000 -64,000 3 18,000 -46,000 4 17,000 -29,000 5 20,000 -9,000 6 18,000 7 16,000 8 14,000 9 10,000 10 13,000 1. Determine the payback period of the investment. (Round your response to 1 decimal place) Payback period 6.5 Years because 9,000/18,000 = 0.5 + 6 yrs = 6.5 6.5 years was marked wrong. Why?
Answers
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Posted 22 Dec 2017 07:12 AM
My Price 10.00
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