Raaya J.

asked • 12/14/21

payback period and npa

Mahindra Co Wants to invest in plant costing ₹15,00,000 and has estimated annual

cash inflows to be generated from this plant as ₹500,000, ₹400,000, ₹400,000, ₹500,000,

₹600,000 during its life of five years . The Cost of capital is 10%. the plant also requires

initial working capital investment of ₹2,00,000. It has a salvage value of ₹150,000. Both

working capital and salvage value will be realized in the last year of the project. Find out

the Payback Period and Net Present Value of the investment proposal.

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