Pappy's Potato has come up with a new product, the Potato Pet (they are freeze-dried to last longer#. Pappy?s paid $125,000 for a marketing survey to determine the viability of the product. It is felt that Potato Pet will generate sales of $580,000 per year. The fixed costs associated with this will be $184,000 per year, and variable costs will amount to 20 percent of sales. The equipment necessary for production of the Potato Pet will cost $630,000 and will be depreciated in a straight-line manner for the four years of the product life #as with all fads, it is felt the sales will end quickly). This is the only initial cost for the production. Pappy?s is in a 35 percent tax bracket and has a required return of 14 percent

Requirement 1:

Calculate the payback period for this project. (Do not round intermediate calculations. Round your answer to 2 decimal places (e.g., 3.16)

Payback Period years

Requirement 2:

Calculate the NPV for this project.

NPV

Requirement 3:

Calculate the IRR for this project.

IRR