Patterson Corp. is considering the purchase of a new piece of equipment, which would have an...

Patterson Corp. is considering the purchase of a new piece of equipment, which would have an initial cost of $528,000, a 7-year life, and $150,000 salvage value. The increase in net income each year of the equipment's life would be as follows:


Year 1	$	105,000
Year 2	$	97,000
Year 3	$	95,000
Year 4	$	84,000
Year 5	$	81,000
Year 6	$	76,000
Year 7	$	70,000

What is the payback period?

Multiple Choice

5.92 years
6.13 years
3.77 years
3.50 years

Solutions

Expert Solution

ekkarill92 answered 1 year ago

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