(Ignore income taxes in this problem.) Rogers Company is studying a project that would have a ten-year life and would require an $2,500,000 investment in equipment which has no salvage value. The project would provide net operating income each year as follows for the life of the project:

Sales		$1,350,000
Less cash variable expenses		227,000
Contribution margin		1,123,000
Less fixed expenses:
Fixed cash expenses	$540,000
Depreciation expenses	148,000	688,000
Net operating income		$435,000

The company's required rate of return is 8%. What is the payback period for this project? (Round your answer to two decimal places.)

	3.19 years
	5.75 years
	2.23 years
	4.29 years