[The Following Information Applies to the Questions Displayed Below

question 50

Multiple Choice

[The following information applies to the questions displayed below.]
Newport Corporation is considering investing $65,000 in equipment to produce a new product.The useful service life of the equipment is estimated to be ten years,with no salvage value.Straight-line depreciation is used.The company estimates that production and sale of the new product will increase net income by $6,500 per year.
-The payback period of this investment is:

• A)Four years.
• B)Five years.
• C)Six years.
• D)Over six years.