If a proposed expenditure of $$ \$ 70,000 $$ for a fixed asset with a 4 -year life has an annual expected net cash inflow and net income of $$ \$ 32,000 $$ and $$ \$ 12,000 $$, respectively, the cash payback period is 2.5 years True False

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To determine if the statement is true or false, we need to calculate the cash payback period for the proposed expenditure of $70,000 for a fixed asset with a 4-year life, given the annual expected net cash inflow and net income of $32,000 and $12,000, respectively.

The cash payback period is the time it takes for the initial investment to be recovered through the net cash inflows.

Given:
- Initial investment: $70,000
- Annual expected net cash inflow: $32,000
- Annual expected net income: $12,000

Let's calculate the cash payback period:
Calculate the value by following steps:
- step0: Calculate:
  $$\frac{70000}{32000}$$
- step1: Reduce the fraction:
  $$\frac{35}{16}$$
The cash payback period is approximately 2.1875 years.

Therefore, the statement that the cash payback period is 2.5 years is **False**.
The cash payback period is approximately 2.19 years, so the statement is False.

If a proposed expenditure of for a fixed asset with a 4 -year life has an annual expected net cash inflow and net income of and , respectively, the cash payback period is 2.5 years
True
False

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If a proposed expenditure of for a fixed asset with a 4 -year life has an annual expected net cash inflow and net income of and , respectively, the cash payback period is 2.5 years True False