A shoe manufacturer is evaluating new equipment that would custom fit athletic shoes. The new equipment costs $109,000 and will generate $42,000 in net cash flows for five years. (Negative cumulative cash flows should be indicated with a minus sign.) Determine the break-even time for this equipment.

Year	Net Cash Flow	x	Present Value of 1 at 12%	=	Present Value of Net Cash Flows	Cumulative Present Value of Net Cash Flows
Initial investment	$(109,000)	x	1.0000	=	$(109,000)	$(109,000)
Year 1	42,000	x	0.8929	=
Year 2	42,000	x	0.7972	=
Year 3	42,000	x	0.7118	=
Year 4	42,000	x	0.6355	=
Year 5	42,000	x	0.5674	=
(Round break-even time answers to two decimal places.)