Cash Payback Period for a Service Company Prime Financial Inc. is evaluating two capital investment proposals for a drive-up ATM kiosk, each requiring an investment of $200,000 and each with an eight-year life and expected total net cash flows of $320,000. Location 1 is expected to provide equal annual net cash flows of $40,000, and Location 2 is expected to have the following unequal annual net cash flows:
Year 1 $60,000 Year 5 $30,000
Year 2 50,000 Year 6 30,000
Year 3 50,000 Year 7 30,000
Year 4 40,000 Year 8 30,000
Determine the Cash Paybck period for both location proposals.
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