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  3. a company is considering a project with the follow

A company is considering a project with the following characteristics: Cash outflows: Immediate investment...

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Accounting

A company is considering a project with the following characteristics:

Cash outflows:

  • Immediate investment in equipment: $379,000
  • Cash outflow for equipment maintenance in year 2: $55,000

Cash inflows:

  • Cash savings in year 1: $50,000
  • Cash savings in year 2: $100,000
  • Cash savings in year 3: $100,000
  • Cash savings in year 4: $150,000
  • Cash savings in year 5: $200,000
  • Salvage value at the end of year 5: $60,000

What is the Payback Period (in years) for this project? (Round your answer to 2 decimal places.)

(Use the present values tables above for any present value calculations. Don't round intermediate calculations. Round your final answer to the nearest dollar.)

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