=+18-32 K Payback, even and uneven cash flows OBJECTIVE 5 You have the opportunity to expand your business by purchasing new equipment for $225000. You expect to incur cash fixed costs of $45000 per year to use this new equipment, and you expect to incur cash variable costs in the amount of 20% of cash revenues.

Required 1 Calculate the payback period for this investment assuming you will generate $95000 in cash revenues every year.