A machine can be purchased for $298,000 and used for five years, yielding the following net incomes. In projecting net incomes, double-declining depreciation is applied using a five-year life and a zero salvage value.

	Year 1				Year 2				Year 3				Year 4				Year 5
Net income		$	13,500			$	47,000			$	79,000			$	44,500			$	124,000

Compute the machines payback period (ignore taxes). (Round payback period answer to 3 decimal places.)

Year Beginning Book Value Computation of Annual Depreciation Expense Annual Depr. (40% Accumulated of Book Value) Depreciation at Year-End 119,200 119,200 71,520 Ending Book Value 1 178,800 298,000 178,800 2 3 4 5 Annual Cash Flows Year Net income Depreciation Net Cash Flow Cumulative Cash Flow $ (298,000) 0 1 119,200 71,520 2 $ (298,000) 13,500 47,000 79,000 44,500 124,000 3 79,000 4 44,500 124,000 79,000 123,500 247,500 5 Payback period years