Griffith Vehicle has received three proposals for its new vehicle-painting machine. Information on each proposal is as follows:

a. Calculate the payback period for each proposal.

b. Based solely (only) on the calculated payback periods for each proposal above, which project and why, is management likely to prefer for investment?

Proposal X Proposal Y Proposal Z $240,000 $150,000 $190,000 0 0 10,000 Initial investment in equipment Working capital needed Annual cash saved by operations: Year 1 Year 2 Year 3 Year 4 Working capital returned 80,000 80,000 80,000 80,000 0 50,000 42,000 46,000 24,000 0 80,000 80,000 80,000 80,000 10,000