Forecast cash outflows and inflows from the bottles project are shown in Table 15.5:

Danni and Sam have agreed a target payback period of three years.
Calculate the payback period for the bottles project, and advise Danni and Sam on whether they should consider proceeding further with this project.

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Table 15.5 The bottles project Time At start '000 Cost of moulding machines, less grant 1,300 After one year Cash inflow from bottle sales 360 After two years Cash inflow from bottle sales 550 After three years Cash inflow from bottle sales 710 After four years Cash inflow from bottle sales 340 After four years Scrap value of machines 100