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Ostermeyer Corporation is considering a project that would require an initial investment of $307,000 and would last for 8 years. The incremental annual revenues and

Ostermeyer Corporation is considering a project that would require an initial investment of $307,000 and would last for 8 years. The incremental annual revenues and expenses for each of the 8 years would be as follows (Ignore income taxes.):

Sales$ 213,000
Variable expenses52,000
Contribution margin161,000
Fixed expenses:
Salaries$ 25,000
Rents35,000
Depreciation34,500
Total fixed expenses94,500
Net operating income$ 66,500

At the end of the project, the scrap value of the project's assets would be $17,500.

Required:

Determine the payback period of the project.

Note: Round your answer to 2 decimal places.

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