Wright Corp

question 74

Multiple Choice

Wright Corp.is considering the purchase of a new piece of equipment,which would have an initial cost of $1,000,000 and a 5-year life.There is no salvage value for the equipment.The increase in net income each year of the equipment's life would be as follows: What is the payback period?

• A)1.77 years
• B)2.06 years
• C)2.96 years
• D)3.51 years

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Definitions:

Employer/Employee Context

The environment and circumstances surrounding the relationship between an employer and their employees, which includes rights, obligations, and expectations.

Restrict

To limit or control the size, amount, or range of something through regulations or conditions.

Recognizance

An obligation in which a party acknowledges in court that he or she will perform some specified act and/or pay a price on failure to do so.

Formal Contract

A legally binding agreement that requires a specific form, such as being in writing, to be valid.