Assume a company is going to make an investment of $450,000 in a machine and the following are the cash flows that two different products would bring in years one through four. Option A, Product A Option B, Product B $190,000 $150,000 185,000 175,000 60,000 60,000 25,000 75,000 A. Calculate the payback period of each product. Round your answers to 2 decimal places. Option A, Product A fill in the blank 1 years Option B, Product B fill in the blank 2 years B. Which of the two options would you choose based on the payback method?

Assume a company is going to make an investment of $450,000 in a machine and the following are the cash flows that two different products would bring in years one through four. Option A, Product A Option B, Product B $190,000 $150,000 185,000 175,000 60,000 60,000 25,000 75,000 A. Calculate the payback period of each product. Round your answers to 2 decimal places. Option A, Product A fill in the blank 1 years Option B, Product B fill in the blank 2 years B. Which of the two options would you choose based on the payback method?

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 4EA: Assume a company is going to make an investment of $450,000 in a machine and the following are the...

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