Top managers may turn down cost saving ideas because they do not pay off quickly enough true or false

True

Explanation:

Payback period capital budgeting method is used to determine when cash inflow or savings from an investment will payback initial outlay.

It gives a quick estimate of when investment will be recoup.

Projects or investment with shorter payback period are favor over others with longer payback period.

The longer it takes to recoup initial investment, the riskier the project.

Payback Period = (Capital Outlay Investment Required / Annual Project

Savings or Cash Inflow).