The Whispering Winds Company is planning to purchase $661,100 of equipment with an estimated seven-year life and no estimated salvage value. The company has projected the following annual cash flows for the investment.

Year		Projected Cash Flows
1			$261,000
2			176,600
3			126,900
4			82,800
5			82,800
6			53,500
7			53,500
Total			$837,100

(a) Calculate the payback period for the proposed equipment purchase. Assume that all cash flows occur evenly throughout the year.

Payback period

enter a number of years years and enter a number of months months.

(b) If Whispering Winds requires a payback period of 4 years or less, should the company make this investment?

The company select an option should not/should make this investment.