Day: November 11, 2023

Accounting Multiple Choice Question – 11 November 2023

The home of multiple choice questions for all your KS3, KS4 and KS5 Business Studies, Economics and Accounting requirements.

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Alex Trading Ltd invests in a project which cost £210,000.

The project will yield annual cash flows of £90,000 for each of the next three years.

After providing annual depreciation of £10,000 the project will yield an annual profit of £80,000.

What is the payback period, assuming profits and depreciation arise at the year-end?

Select ONE answer:

  1. 2.33 years
  2. 2.50 years
  3. 2.62 years
  4. 3 years

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

  1. Correct – £210k – £90k – £90k – £30k / £90k == > 2 1/3 years
  2. Not correct
  3. Not correct
  4. Not correct

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