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A machine can be purchased for $210,000 and used for five years, yielding the following income. This income computation includes annual depreciation expense of
A machine can be purchased for $210,000 and used for five years, yielding the following income. This income computation includes annual depreciation expense of $42,000. Income Year 1 $14,200 Year 2 $35,200 Year 3 $91,000 Year 4 $53,100 Year 5 $140,800 Compute the machine's payback period. (Round payback period answer to 2 decimal places.) Cumulative Net Cash Year Net Income Depreciation Net Cash Flow Flow Initial invest $ (210,000) $ (210,000) Year 1 $ Year 2 14,200 $ 35,200 42,000 56,200 42,000 77,200 Year 3 91,000 42,000 56,400 Year 4 53,100 42,000 Year 5 140,800 42,000 Payback period= 2.58 years
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