36. (Multiple methods) Indiana Furniture Mart is considering buying a delivery truck at a cost of $52,000. Presently, the store relies on a delivery service to deliver its products to area customers. The truck is expected to last six years and have a $7,500 salvage value. Annual operating savings (in delivery costs) are expected to be $14,000 for each of the first two years, $11,000 for each of the next two years, and $9,000 for the last two years. The company’s cost of capital is 10 percent and this rate was set as the discount rate.

a. Calculate the payback period (ignore tax).

b. Calculate the net present value (ignore tax).

c. Calculate the profitability index (ignore tax).