Patterson Corp. is considering the purchase of a new piece of equipment, which would have an initial cost of $528,000, a 7-year life, and $150,000 salvage value. The increase in net income each year of the equipment's life would be as follows:

Year 1	$	105,000
Year 2	$	97,000
Year 3	$	95,000
Year 4	$	84,000
Year 5	$	81,000
Year 6	$	76,000
Year 7	$	70,000

What is the payback period?

Multiple Choice

• 5.92 years

• 6.13 years

• 3.77 years

• 3.50 years