Following are the data on a capital project being evaluated by the management of Aman Ltd. Particulars Project A Annual cost saving 1,80,000 Useful…

CA Intermediate · Financial Management and Strategic Management · MTP · January 2025
Following are the data on a capital project being evaluated by the management of Aman Ltd. Particulars Project A Annual cost saving 1,80,000 Useful life 5 years Internal rate of return 10% Salvage value 0 PVAF (15,4 years) 3.79 Based upon the information, the payback period of the project will be
(A) 2.652
(B) 2.850
(C) 3.790
(D) 3.855

Suggested Answer and Working Notes:

Correct Answer: Option (C)

3.790

Topics: Part-A: Financial Management

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