Cash payback period for a service company

Haukea Clothing Inc. is evaluating two capital investment proposals for a retail outlet, each requiring an investment of $$125,000$ and each with an eight$-$year life and expected total net cash flows of $$200,000.$ Location $1$ is expected to provide equal annual net cash flows of $$25,000,$ and Location $2$ is expected to have the following unequal annual net cash flows:

Year Amount Year Amount

Year $1$ $$49,000$ Year $5$ $$26,000$

Year $236,000$ Year $621,000$

Year $324,000$ Year $715,000$

Year $416,000$ Year $813,000$

Determine the cash payback period for both location proposals.

Location Year

Location $1$

years

Location $2$

years