1 A B D E Ursus, Inc., is considering a project that would have a 5 year life and would require a $1,806,000 investment in equipment. At end of 5 years, the project would terminate and the equipment would have no salvage value. The project would provide net operating income each year as follows (Ignore income taxes.): Sales Variable expenses Fixed expenses including depreciation 2 3 4 5 6 7 8 9 1. Payback period = Investment required 10 11 Net annual cash inflow $2,700,000 1,700,000 761,200 All of the above items, except for depreciation, represent cash flows. The company's required rate of return is 14%. 12 Required: 13 Compute the project's payback period. (Round your answer to 2 decimal place.) (5 marks) 14 15 16 17 Depreciation expense 8 9 0 1 2 Incremental annual cash flows Payback period