Nolan Company Would Like to Open an Office for Five

Nolan Company would like to open an office for five years in Southern California.The initial investment required to purchase an office building is $1,500,000,and Nolan needs $400,000 in working capital for the new office.Working capital will be released back to the company at the end of five years.The company expects to remodel the office at the end of 2 years at a cost of $180,000.The company only accepts projects that have a payback period of less than three years.Annual net cash receipts from daily operations (cash receipts minus cash payments)are expected to be as follows:

(1)Calculate the payback period for this project rounded to the nearest month.Show your work.
(2)Should the company accept this proposal? Explain.