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Pina Colada Company is considering buying a machine for $120000 with an estimated life of 10 years and no salvage value. The straight-line method of

Pina Colada Company is considering buying a machine for $120000 with an estimated life of 10 years and no salvage value. The straight-line method of depreciation will be used. The machine is expected to generate net income of $8000 each year. The cash payback period on this investment is

7.50 years.

1.50 years.

6.00 years.

10.00 years.

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