Sample Test Problem 10.2

Flowers Unlimited is considering purchasing an additional delivery truck that will have a seven-year useful life. The new truck will cost $43,300. Cost savings with this truck are expected to be $13,200 for the first two years, $9,200 for the following two years, and $5,200 for the last three years of the trucks useful life. What is the payback period for this project? (Round answer to 2 decimal places, e.g. 52.75.)

payback period_______ years?

what is the discounted payback periodfor this project with a discount rate of 10% (Do not round discount factors. Round answer to 2 decimal places, e.g. 52.75.)

discounted payback period_____ years?