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(Ignore income taxes in this problem.) Baldock Inc. is considering the acquisition of a new machine that costs $429,000 and has a useful life of
(Ignore income taxes in this problem.) Baldock Inc. is considering the acquisition of a new machine that costs $429,000 and has a useful life of 5 years with no salvage value. The incremental net operating income and incremental net cash flows that would be produced by the machine are:
| Incremental Net Operating Income | Incremental Net Cash Flows | |
| Year 1 | $70,000 | $152,000 |
| Year 2 | $76,000 | $155,000 |
| Year 3 | $87,000 | $165,000 |
| Year 4 | $50,000 | $152,000 |
| Year 5 | $92,000 | $154,000 |
Assume cash flows occur uniformly throughout a year except for the initial investment.
The payback period of this investment is closest to:
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