You want to get approval for a capital expense to bring the copy service back in-house. An investment of $24,000.00 for a dedicated computer and a new copy machine will support the ROI staff you already have. You estimate that it will bring in a cash income of $40,000.00 over the next five years. Your facility uses straight-line depreciation to calculate the average net income.

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• Use the following formula to calculate the payback period: Initial Outlay (Investment)/Average Net Income = Payback Period
• Calculate the number of years it will take to pay back the investment

NPV at 10% Net Cash Factor for NPV at Years Flow 10% Present Value of Cash Flow 1 $2,000.00 $0.909091 2 $5,000.00 $0.826446 3 $9,000.00 $0.751315 4 $11,000.00 $0.683013 5 $13,000.00 $0.620921