Charlie€™s Truck Repair and Service has a new contract that requires him to purchase and maintain new equipment for work on 18-wheeler trucks and heavy road equipment. Two separate vendors have made quotes and estimates for Charlie. Use the estimates and a 6% per year return requirement to find the better economic option. One problem is that Charlie does not currently know if the contract will last for 5, 8, or 10 years. He needs a recommendation for all three time periods.

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Vendor Ferguson -203,000 Halgrove - 396,000 First cost P, $ M&O, $ per year Salvage value, SV Maximum life, years -90,000 10% of P 5 -82,000 10% of P 10