discounted payback period


Timeframe required to regain the value of discounted cash flow, so that it equals the value of the initial investment. The formula to calculate this figure is: Payback Period (Year before recovery + unrecovered cost at the start of the year/cash flow during the year).

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You may want to try and put yourself in a discounted payback period so that you know things will get done.

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Banks utilize a discounted payback period in loan situations so that there is no issues with due times for payments on the loan itself.

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When the company accountant looked at the discounted payback period for the new chicken processing equipment on the ledger he saw that he wrote a cost of $12 million dollars at the beginning of the year for the upgrade and company average revenue was $6 million a month giving him 3 months (1 month + $12 million/$6 Million)

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