A Company Is Considering Purchasing a Machine for $21,000

question 32

Multiple Choice

A company is considering purchasing a machine for $21,000. The machine will generate an after-tax net income of $2,000 per year. Annual depreciation expense would be $1,500. What is the payback period for the new machine?

• A) 4 years.
• B) 6 years.
• C) 10.5 years.
• D) 14 years.
• E) 42 years.

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Definitions:

Sieve Tubes

A series of sieve tube elements placed end to end to form channels for nutrient transport in plants.

Vessel Members

Components of the xylem tissue in plants that help conduct water and minerals from the roots to the rest of the plant.

Companion Cells

Plant cells that aid in the transport and regulation of nutrients within the phloem.

Pits

Small depressions or cavities on a surface, often used to describe features in plant or geological structures.