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Payback period is the method in which the time to recover the projected cash inflow equals the investment expenditure calculated. True or false?

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Question added by Musa Muhammad Dandikko , Ag. Head of Procurement , Federal College of Education, Katsina
Date Posted: 2013/10/23
Khaled Abdelrehim ACCA DipIFR CMA
by Khaled Abdelrehim ACCA DipIFR CMA , Financial Analysis Assistant General Manager , Khalda Petroleum Company

the time of the projected cash inflows equals the investment outflow expenditure

Deleted user
by Deleted user

True

I agree with the answers given already.Payback method is a simplistic approach of reviewing capital investment feasibility, without the complexity of time value of money.

mukkur srinivasan varadhan
by mukkur srinivasan varadhan , Chartered Accountant , Chartered Accountant in practice

True,without giving effect to the time value of money.

Mohammad Ibrahim, CMA, CertIFR
by Mohammad Ibrahim, CMA, CertIFR , Accounting Operation Team Leader , KFH ( Kuwait Finance House )

True ,

payback Period is a way to calculate the period of Time taken to recover the Investment Expenditures .  

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