Jordan Enterprises is considering a capital expenditure that requires an initial investment of $ 63,000 and returns after tax cash inflows $13,246 per year for 10 years. The firm has a maximum acceptable payback period of 8 years
a) The payback period for this project is ____years Round to two decimal places
b) Should the company accept the? project? ?(Select the best answer? below.)
1 The company should accept the project since the payback period is less than the maximum.
2 The company should accept the project since the? after-tax cash flows occur for more years than the maximum acceptable payback.
3 The company should reject the project since the payback period is less than the number of years of the? after-tax cash flows.
4 The company should reject the project since the? after-tax cash flows occur for more years than the maximum acceptable payback.
5 The company should reject the project since the payback period is less than the maximum.