Baldock Inc. is considering the acquisition of a new machine that costs $473,000 and has a useful life of 5 years with no salvage value. The incremental net operating income and incremental net cash flows that would be produced by the machine are:

Assume cash flows occur uniformly throughout a year except for the initial investment.
The payback period of this investment is closest to:
2.1 years
5.0 years
4.1 years
2.9 years
B.)
Shields Company has gathered the following data on a proposed investment project: (Ignore income taxes in this problem.)
Investment required in equipment...............................$640,000
Annual cash inflows................................................$86,000
salvage value...............................................................$0
Life of the investment 20 years
Required rate of return...................................................9%7.4 years
The company uses straight-line depreciation. Assume cash flows occur uniformly throughout a year except for the initial investment.
The payback period for the investment is closest to:
0.1 years
1.0 years
5.4 years

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Incremental Net Incremental Net Operating IncomeCash Flows Year 1 Year 2 Year 3 Year 4 Year 5 $81,000 $87,000 $98,000 S61,000 S103,000 $155,000 $166,000 $175,000 $163,000 $165,000