BPP Exam kit Question 98 – Payback period

A project has average estimated cash flows of $3000 per year with an initial investment of $9000.

Depreciation is straight-line with no residual value and the project has a 5 year life span. The company has a target ROCE of 15% and a target payback period of 2.5 years. ROCE is based on initial investment.

Under which investment appraisal methods, using the company’s targets, will the project be accepted? 1. ROCE 2. Payback basis

My question: In the BPP answer section, ROCE was calculated after adjusting depreciation. But for calculating Payback period it just used $3,000 without adjusting depreciation ie. 9000/3000. May i know why amount after adjusting depreciation was not used for Payback calculation.

Thanks Sir!