Answer to Question #229020 in Finance for ngwane

Question

Calculate the following from the information given below:

4.1.1 Payback Period (expressed in years). (3)

4.1.2 Return on investment (expressed to two decimal places). (5)

INFORMATION

Tridev Limited intends investing in a new project. The following details relate to one of the

projects it can choose from:

Initial cost R400 000

Expected useful life 4 years

Scrap value 0

Depreciation per year R100 000

Minimum required rate of return 14%

Expected net cash flows: R

End of Year 1 110 000

Year 2 120 000

Year 3 125 000

Year 4 160 000

Answer 1

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