The payback method helps firms establish and Identify a maximum acceptable payback period that helps in thelr capital budgeting decislons.

Consider the case of Cute Camel Woodcraft Company:

Cute Camel Woodcraft Company is a small firm, and several of Its managers are worried about how soon the firm will be able to recover

Its initial Investment from Project Delta's expected future cash flows. To answer this question, Cute Camel's CFO has asked that you

compute the project's payback period using the following expected net cash flows and assuming that the cash flows are recelved evenly

throughout each year.

Complete the following table and compute the project's conventional payback period. For full credit, complete the entire table. $($Note: Round the

conventional payback period to the nearest two decimal places. If your answer Is negative use a minus sign.$)$

The conventional payback perlod Ignores the time value of money, and thls concerns Cute Camel's CFo. He has now asked you to compute Delta's

discounted payback period, assuming the company has a $7\%$ cost of capital. Complete the following table and perform any necessary calculations.

Round the discounted cash flow values to the nearest whole dollar, and the dlscounted payback period to the nearest two decimal places. For full

credit, complete the entire table. $($Note: If your answer is negative use a minus sign.$)$