A Project Has an Initial Cost of $2,250

question 33

Multiple Choice

A project has an initial cost of $2,250.The cash inflows are $0,$500,$900,and $700 for Years 1 to 4,respectively.What is the payback period?

• A)2.97 years
• B)2.84 years
• C)3.98 years
• D)3.92 years
• E)Never

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Definitions:

Sales Budget

A financial plan detailing the expected revenues from sales over a specific period, used for setting targets and measuring performance.

Budgeted Income

The forecasted profit or loss for a given period, based on expected revenues and expenses.

Production Budget

An estimate of the total output, expressed in terms of units, that a company plans to produce in a specified period.

Cash Budget

A financial plan that estimates cash inflows and outflows over a specific period, helping businesses manage their cash flow and ensure liquidity.