The cash payback technique

should be used as a final screening tool.

can be the only basis for the capital budgeting decision.

is relatively easy to compute and understand.

considers the expected profitability of a project

Nance Company is considering buying a machine for $90,000 with an estimated life of ten years and no salvage value. The straight-line method of depreciation will be used. The machine is expected to generate net income of $3,000 each year. The cash payback on this investmentis

7.5 years

10 years

15 years

6 years