Mimi Company is considering a capital investment of $275,000 in new equipment. The equipment is expected to have a 5-year useful life with no salvage value. Depreciation is computed by the straight-line method. During the life of the investment, annual net cash inflows are expected to be $80,000. Mimi's minimum required rate of return is 10%.

Required:

Compute the cash payback period for Mimi Company.