Project A requires a $305,000 initial investment for new machinery with a five-year life and a salvage value of $30,500. The company uses straight-line depreciation. Project A is expected to yield annual net income of $27,700 per year for the next five years.

Payback Period

cost of investment/	Annual Net Cash Flow	Payback Period
$305000/	?????	??????

Compute Project A's payback period