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NPV

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FM Exams › NPV

  • This topic has 3 replies, 2 voices, and was last updated 4 years ago by AvatarJohn Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • November 1, 2021 at 7:49 am #639620
    AvatarNercia@1234
    Participant
    • Topics: 21
    • Replies: 22
    • ☆

    Hie sir .
    On question 122 BPP kit
    They say

    Cash flows
    T0 investment 100 000
    T1-5 Net cash inflow 40 000

    What is the adjusted payback period for this project.

    Here

    Their cashflows
    Are written as
    Time 0 40 000
    Time 1 40 000
    Time 2 40 000
    Time 3 40 000

    They have separated the 40 000 for each individual year I thought its a net cash flow it will be 40 000 for the whole 3 years

    However on question 123
    They have the following cash flows
    T0 outflow 110 000
    T1-4 inflow 40 000

    Here they are using an aggregate
    ….

    My question is why the other question they used individual amount each year and the other they used aggregate

    November 1, 2021 at 10:55 am #639638
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54839
    • ☆☆☆☆☆

    When we write T1-4 40,000 we mean that it is 40,000 in each year from time 1 to time 4. Not that it is 40,000 in total.

    November 1, 2021 at 11:00 pm #639710
    AvatarNercia@1234
    Participant
    • Topics: 21
    • Replies: 22
    • ☆

    Thank you sir

    November 2, 2021 at 6:48 am #639726
    AvatarJohn Moffat
    Keymaster
    • Topics: 57
    • Replies: 54839
    • ☆☆☆☆☆

    You are welcome 🙂

  • Author
    Posts
Viewing 4 posts - 1 through 4 (of 4 total)
  • The topic ‘NPV’ is closed to new replies.

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