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8 pt X Comnpany must replace one of its current machines with either Machine A or Machine B. The useful life of both machines is

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8 pt X Comnpany must replace one of its current machines with either Machine A or Machine B. The useful life of both machines is seven years. Machine A costs $48,000, and Machine B costs $67,000. Estimated annual cash flows with the two machines are as follows: Machine B Machine A Year $-7,000 S-6,000 -8,000 -8,000 -8,000 -6,000 -5,000 -4,000 1 -4,000 -3,000 3 -3,000 -3,000 -2,000 -2,000 4 6 7 If X Company buys MachineB instead of Machine A, what is the payback period (in years)? 11. AO 2 EO 6 FO 7 BO 3 CO 4 DO 5

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