Project Y requires a $350,000 investment for new machinery with a four-year life and no salvage value. The project yields the following annual results. Cash flows occur evenly within each year. (PV of $1, FV of $1, PVA of $1, and FVA of $1) Note: Use appropriate factor(s) from the tables provided. Annual Amounts Sales of new product Expenses Materials, labor, and overhead (except depreciation) Depreciation-Machinery Selling, general, and administrative expenses Income 2. Determine Project Y's payback period. Project Y Numerator: Payback Period 1 1 Denominator: II = = Project Y $ 350,000 157,500 87,500 49,000 $ 56,000 Payback period 0

Project Y requires a $350,000 investment for new machinery with a four-year life and no salvage value. The project yields the following annual results. Cash flows occur evenly within each year. (PV of $1,FV of $1,PVA of $1, and FVA of $1) Note: Use appropriate factor(s) from the tables provided. 2. Determine Project Y's payback period