GoFlo Is a Small Growing Firm That Is Considering the Purchase

question 12

Multiple Choice

GoFlo is a small growing firm that is considering the purchase of another truck to serve GoFlo's expanding customer base. The new truck will cost $21,000 and should generate annual net cash flows of $6,000 over the truck's 5-year life. What is the payback period for this project?

• A) 3 years
• B) 4.2 years
• C) 3.5 years
• D) 3.3 years