Exercise 24-4 Payback period; accelerated depreciation LO P1 A machine can be purchased for $256,000 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 5 Net Income Year 1 $23,500 Year 2 $28,000 Year 3 $75,000 Year 4 $41,000 $127,000 Compute the machine's payback period (ignore taxes). (Round payback period answer to 3 decimal places.) Computation of Annual Depreciation Expense Annual Depr. (40% Accumulated of Book Value) Depreciation at Year-End Year Beginning Book Value Ending Book Value 1 2 3 4 - 5 Annual Cash Flows Year Net Income Depreciation Net Cash Flow Cumulative Cash Flow $ (256,000) $ 0 1 2 3 (258,000) 23,500 28,000 75,000 41,000 127,000 75,000 41,000 4 75.000 116.000 243.000 6 127 poo Payback period years