Cash Payback Period for a Service Company Chinook Industries Inc. is evaluating two capital investment proposals for a retail outlet, each requiring an investment of $225,000 and each with an...

Cash Payback Period for a Service Company

Chinook Industries Inc. is evaluating two capital investment proposals for a retail outlet, each requiring an investment of $225,000 and each with an eight-year life and expected total net cash flows of $360,000. Location 1 is expected to provide equal annual net cash flows of $45,000, and Location 2 is expected to have the following unequal annual net cash flows:

Determine the cash payback period for both location proposals.