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 $120,000 and each with an eight-year life and expected total net cash flows of $240,000. Location 1 is expected to provide equal annual net cash flows of $30,000, and Location 2 is expected to have the following unequal annual net cash flows: Year Amount Year Amount Year 1 $54,000 Year 5 $29,000 Year 2 41,000 Year 6 22,000 Year 3 25,000 Year 7 1

Cash payback perlod for a service company Location 1 is expected to provide equal annual net cash flows of $30,000, and Location 2 is expected to have the following unequal annual net cash flows: Determine the cash payback period for both location proposals. Location 1 Location 2