Buy Coastal, Inc., imposes a payback cutoff of three years for its international investment projects.
|
Year
|
Cash Flow (A)
|
|
Cash Flow (B)
|
|
0
|
-$
|
64,000
|
|
|
-$
|
74,000
|
|
|
1
|
|
25,000
|
|
|
|
17,000
|
|
|
2
|
|
32,000
|
|
|
|
20,000
|
|
|
3
|
|
23,000
|
|
|
|
30,000
|
|
|
4
|
|
10,000
|
|
|
|
234,000
|
|
What is the payback period for both projects?
Which project should the company accept?