Nestor Company is considering the purchase of an asset for $100,000. It is expected to produce the following net cash flows. The cash flows occur evenly throughout each year. Annual NetCash FlowsYear 1$40,000 Year 2$40,000 Year 3$35,000 Year 4$35,000 Year 5$30,000 Compute the payback period for this investment.
A. 2.50 years.
B. 3.00 years.
C. 2.85 years.
D. 2.57 years.
E. 3.62 years.
Answer: D
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a. $6,300 b. $6,800 c. $6,500 d. $7,900
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When analyzing a balance sheet
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Dulcey agrees to cosign a promissory note for Excavation Equipment Leasing & Sales to buy a backhoe. The note is payable to Federal Bank. Dulcey is an accommodation
a. drawee. b. indorser. c. maker. d. drawer.