Giraldi Company Has Identified That the Cost of a New

question 37

Multiple Choice

Giraldi Company has identified that the cost of a new computer will be $48,000, but with the use of the new computer, net income will increase by $5,000 a year. If depreciation expense is $3,000 a year, the cash payback period is:

• A) 24.0 years.
• B) 16.0 years.
• C) 9.6 years.
• D) 6.0 years.

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Definitions:

Buying Systems

The organizational structures and processes through which companies purchase goods and services.

Committee

A group of individuals appointed to perform a specific task or to deliberate on a particular issue, often within a larger organization or assembly.

B2B

Business-to-Business, referring to transactions or strategies between two or more businesses rather than between businesses and individual consumers.

Buying Decisions

The process by which individuals or organizations choose whether to purchase, what to purchase, and from whom to purchase, based on factors like needs, preferences, and financial resources.