Question 15 Olinick Corporation is considering a project that would require an investment of $343,000 and would last for 8 years. The incremental annual revenues and expenses generated by the project during those 8 years would be as follows (Ignore income taxes.):

Sales $ 227,000

Variable expenses 52,000

Contribution margin 175,000

Fixed expenses:

Salaries 27,000

Rents 41,000

Depreciation 40,000

Total fixed expenses 108,000

Net operating income $ 67,000

The scrap value of the project's assets at the end of the project would be $23,000. The cash inflows occur evenly throughout the year. The payback period of the project is closest to:

3.0 years

5.1 years

3.2 years

4.8 years