Business, 30.07.2019 06:10, jbryant071405

Red sox corporation wants to purchase a new machine for $350,000. management predicts that the machine can produce sales of $205,000 each year for the next 5 years. expenses are expected to include direct materials, direct labor, and factory overhead (excluding depreciation) totaling $85,000 per year. the firm uses straight-line depreciation with no residual value for all depreciable assets. pique's combined income tax rate is 35%. management requires a minimum after-tax rate of return of 10% on all investments. what is the payback period for the new machine (rounded to nearest one-tenth of a year)? (assume that the cash inflows occur evenly throughout the year.)

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Red sox corporation wants to purchase a new machine for $350,000. management predicts that the machi...