(Ignore Income Taxes in This Problem

question 24

Multiple Choice

(Ignore income taxes in this problem.) Gull Inc. is considering the acquisition of equipment that costs $480,000 and has a useful life of 6 years with no salvage value. The incremental net cash flows that would be generated by the equipment are:
-The payback period of this investment is closest to:

• A)3.1 years
• B)2.9 years
• C)5.0 years
• D)3.5 years