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Exercise 24-4 (Algo) Payback period, unequal cash flows, and depreciation adjustment LO P1 A machine can be purchased for $90,000 and used for five years, yielding the following income. This income computation includes annual depreciation expense of $18,000. Income Year 1 $6,000 Year 2 $15,000 Year 3 $36,000 Year 4 $22,500 Year 5 $60,000 Compute the machine's payback period. (Round payback period answer to 2 decimal places.) Answer is not complete. Year Net Income Net Cash Cumulative Net Depreciation Flow Cash Flow Initial invest $ (90,000) S (90,000) Year 1 $ 6,000 S 18,000 24,000 (66,000) Year 2 15,000 18,000 Year 3 36,000 18,000 Year 4 22,500 18,000 Year 5 60,000 18,000 0 0 Payback period =

Exercise 24-4 (Algo) Payback period, unequal cash flows, and depreciation adjustment LO P1 A machine can be purchased for $90,000 and used for five years, yielding the following income. This income computation includes annual depreciation expense of $18,000. Income Year 1 $6,000 Year 2 $15,000 Year 3 $36,000 Year 4 $22,500 Year 5 $60,000 Compute the machine's payback period. (Round payback period answer to 2 decimal places.) Answer is not complete. Year Net Income Net Cash Cumulative Net Depreciation Flow Cash Flow Initial invest $ (90,000) S (90,000) Year 1 $ 6,000 S 18,000 24,000 (66,000) Year 2 15,000 18,000 Year 3 36,000 18,000 Year 4 22,500 18,000 Year 5 60,000 18,000 0 0 Payback period =

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Exercise 24-4 (Algo) Payback period, unequal cash flows, and depreciation adjustment LO P1 A machine can be purchased for $90,000 and used for five years, yielding the following income. This income computation includes annual depreciation expense of $18,000. Income Year 1 $6,000 Year 2 $15,000 Year 3 $36,000 Year 4 $22,500 Year 5 $60,000 Compute the machine's payback period. (Round payback period answer to 2 decimal places.) Answer is not complete. Year Net Income Net Cash Depreciation Cumulative Net Flow Cash Flow Initial invest $ (90,000) $ (90,000) Year 1 $ 6,000 $ 18,000 24,000 (66,000) Year 2 15,000 18,000 Year 3 36,000 18,000 Year 4 22,500 18,000 Year 5 60,000 18,000 0 0 Payback period =
Transcribed Image Text:Exercise 24-4 (Algo) Payback period, unequal cash flows, and depreciation adjustment LO P1 A machine can be purchased for $90,000 and used for five years, yielding the following income. This income computation includes annual depreciation expense of $18,000. Income Year 1 $6,000 Year 2 $15,000 Year 3 $36,000 Year 4 $22,500 Year 5 $60,000 Compute the machine's payback period. (Round payback period answer to 2 decimal places.) Answer is not complete. Year Net Income Net Cash Depreciation Cumulative Net Flow Cash Flow Initial invest $ (90,000) $ (90,000) Year 1 $ 6,000 $ 18,000 24,000 (66,000) Year 2 15,000 18,000 Year 3 36,000 18,000 Year 4 22,500 18,000 Year 5 60,000 18,000 0 0 Payback period =
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Section 179 Deduction and Modified Accelerated Cost Recovery System (MACRS) Depreciation
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