The Short-Line Railroad is considering a $185,000 investment in either of two companies. The cash flows are as follows:

Year	Electric Co.			Water Works
1	$	95,000		$	45,000
2		45,000			45,000
3		45,000			95,000
4 10		25,000			25,000

a.	Compute the payback period for both companies. (Round your answers to 1 decimal place.)

	Payback Period
Electric Co.	years
Water Works	years

b.

Which of the investments is superior from the information provided?

	Water Works
	Electric Co.