You Have Submitted a Request to the Board of Directors

Essay

You have submitted a request to the board of directors to purchase a computer-based patient record system. The system is anticipated to save $45,000 in personnel operating costs each year for the next 3 years and will cost $110,000 to install. Operating and maintenance costs for the 3 years are estimated to be $5000 per year. The money to buy the equipment would come from an equipment fund, which is now earning 8%. Calculate the payback period for the investment.