AQA BUSINESS/ PAYBACK PERIOD I keep getting stuck!Watch
I'll give an example:
The payback of an investment is estimated to be 3 years and 8 months. Net cash flows in Year 1 are estimated to be £60'000, £70'000 in Year 2 and £90'000 in Year 3. The estimated cost of the investment is £300'000. Calculate the estimated net cash flows in Year 4.
shouldn’t the cash flow be negative at the start? i think you’ve got the wrong numbers
The cost of the investment itself is negative.
So as you add cash inflow each year, it should be positive by Year 4 but I can't work out how much inflow there is for Year 4 though