Exercise 6 Birch manufacturing is considering the addition of another product line to its offerings. Equipment needed to produce the new line will cost $210,960. Birch estimates that the net cash inflows from the new product line will be as follows:

Years 1-10	$19,200	(each year)
Years 11-15	$4,740	(each year)
Year 16-20	$2,040

(a)What is the payback period for the new product line?

Payback period

years

Exercise 6 Birch manufacturing is considering the addition of another product line to its offerings. Equipment needed to produce the new line will cost $210,960. Birch estimates that the net cash inflows from the new product line will be as follows: Years 1-10 Years 11-15 Year 16-20 $19,200 (each year) $4,740 (each year) $2,040 (a) What is the payback period for the new product line? Payback period years