4 Calculate the Payback Period 6 The payback period is the length of time required for the cash to be coming in from an investment 7 to equal the amount of cash originally spent when the investment was acquired. 10 Assumptions 1 Purchase price of equipment KS 500,000 2 Useful life of equipment 10 years 3 Revenue the machine will generate per year $ 10,000 4 Direct operating costs associated with earning the revenue $ $ 121,000 50,000 5 Depreciation Expense per year 25 Using the above five assumptions, calculate how many years it will take to recoup the 26 original investment