Heels, a shoe manufacturer, is evaluating the costs and benefits of new equipment that would custom fit each pair of athletic shoes. The customer would have his or her foot scanned by digital computer equipment; this information would be used to cut the raw materials to provide the customer a perfect fit. The new equipment costs $117,000 and is expected to generate an additional $45,000 in cash flows for 5 years. A bank will make a $117,000 loan to the company at a 12% interest rate for this equipments purchase. Compute the recovery time for both the payback period and break-even time. (PV of $1, FV of $1, PVA of $1, and FVA of $1). (Use appropriate factor(s) from the tables provided. Round your answers to 2 decimal places.)

Payback Period
Choose Numerator:	/	Choose Denominator:	=	Payback Period
	/		=	Payback period
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Chart Values are Based on:

i =
Year	Cash Inflow (Outflow)	x	PV Factor	=	Present Value	Cumulative Present Value of Inflow (Outflow)
0	$(117,000)	x	1.0000	=	$(117,000)	$(117,000)
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