Christine, and engineer at Opus Ltd., has a $70,000 budget for upgrading the company's warehouse. She calculated that the improvements could be completed in three months from now and would consume the entire budget. Due to these improvements the company saves $9,000 by the end of the first year, $14,000 by the end of the second year, and $35,000 by the end of the third year, $54,000 by the end of the fourth year, and $17,000 by the end of the fifth year. What is the payback period for this project?

A) 1

B) 2

C) 3

D) 4

E) 5

I'm don't know who to solve this, please add a step-by-step guide so I can follow what you did. What we are taught so far about payback period is that Payback = (First Cost) / ( annual savings) , not sure how to use this in this case.