tory Bookmarks Window Help 13. The payback period The payback method helps firms establish and identify a maximum acceptable payback period that helps in their a capital budgeting decisions. Consider the case of Blue Hamster Manufacturing Inc. Blue Hamster Manufacturing Inc. is a small firm, and several of its managers are worried about how soon the firm will be able to recover its initial investment from Project Alpha's expected future cash flows. To answer this question Blue Hamsters CFO has asked that you compute the project's payback period using the following expected net cash flows and assuming that the cash flows are received evenly throughout each year. Complete the following table and compute the project's conventional payback period. For full credit, complete the entire table. Year 2 Year Year Year 3 Expected cash flow 4,500,000 $1,800,000 $3,825,000 $1,575,000 Cumulative cash flow D conventional payback period: The conventional payback period ignores the time value of money, and this concerns Blue Hamster's cFo. He has Complete you to compute Alpha's discounted pay period, assuming the company has a s% cost of capital nearest the folowing table and perform any necessary calculations. Round the discounted cash fiow values to the whole douar, and the discounted payback period to the nearest two docimal places. For full credit, complete Year 1 Year 3 $1800,000 $3.825,000 $1.575,000