(a) Compute each project's annual net cash flow. (b) Compute payback period for each investment. Complete this question by entering your answers in the tabs below. Required A Required B Compute each project's annual net cash flow. Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation Machinery Selling, general, and administrative expenses Income Net cash flow $ $ Income Project 1 160,000 80,000 35,000 23,000 22,000 $ Cash Flow 0 Income $ 140,000 $ Project 2 Cash Flow EA 47,000 33,000 35,000 25,000 0

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Information for two alternative projects involving machinery investments follows. Project 1 requires an initial investment of $256,500.
Project 2 requires an initial investment of $174,000.
Annual Amounts
Sales of new product
Expenses
Materials, labor, and overhead (except depreciation)
Depreciation-Machinery
Selling, general, and administrative expenses
Income
(a) Compute each project's annual net cash flow.
(b) Compute payback period for each investment.
Required A Required B
Complete this question by entering your answers in the tabs below.
Compute each project's annual net cash flow.
Annual Amounts
Sales of new product
Expenses
Materials, labor, and overhead (except depreciation)
Depreciation Machinery
Selling, general, and administrative expenses
Income
Net cash flow
$
$
Income
Project 1
160,000
80,000
35,000
23,000
22,000
Project 1
$ 160,000
$
80,000
35,000
23,000
$ 22,000
Cash Flow
0
$
$
Project 2
$ 140,000
47,000
33,000
35,000
$ 25,000
Project 2
Income
140,000
47,000
33,000
35,000
25,000
Cash Flow
$
0
Transcribed Image Text:Information for two alternative projects involving machinery investments follows. Project 1 requires an initial investment of $256,500. Project 2 requires an initial investment of $174,000. Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Machinery Selling, general, and administrative expenses Income (a) Compute each project's annual net cash flow. (b) Compute payback period for each investment. Required A Required B Complete this question by entering your answers in the tabs below. Compute each project's annual net cash flow. Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation Machinery Selling, general, and administrative expenses Income Net cash flow $ $ Income Project 1 160,000 80,000 35,000 23,000 22,000 Project 1 $ 160,000 $ 80,000 35,000 23,000 $ 22,000 Cash Flow 0 $ $ Project 2 $ 140,000 47,000 33,000 35,000 $ 25,000 Project 2 Income 140,000 47,000 33,000 35,000 25,000 Cash Flow $ 0
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