4

Heidi Company is considering the acquisition of a machine that costs $714,840. The machine is expected to have a useful life of six years, a negligible residual value, an annual net cash flow of $96,600, and annual operating income of $69,000. What is the estimated cash payback period for the machine (round to one decimal point)?

a.4.3 years

b.10.4 years

c.7.4 years

d.1.4 years