Susmel inc. is considering a project that has the following cash flow data. what is the project's payback? year 0 1 2 3 cash flows -$500 $150 $200 $300 2.03 years 2.25 years 2.50 years 2.75 years 3.03 years

Payback period = 2.5 years

Explanation:

given data

Year    0            1           2           3

cash    -$500  $150   $200   $300

to find out

What is the project's payback

solution

Year        Cash flows   Cumulative Cash flows

0                 500             500

1                  150              350

2                 200             150

3                 300              150

so

Payback period = Last period with a negative cumulative cash flow +(Absolute value of cumulative cash flows at that period ÷ Cash flow after that period)      .........................1

put here value we get

so

Payback period =    

Payback period = 2.5 years

the third answer is correct.

answer/// sequence of operations that requires the longest time for completion';