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1 You are planning to purchase a range and have to make a choice among the following three models: Model 1 Model 2 Model 3
1 You are planning to purchase a range and have to make a choice among the following three models: Model 1 Model 2 Model 3 Cash cost $ 5,000 $ 5,500 $ 5,300 Estimate life 5 years 5 years 5 years Trade-in value at end of life $ 1,000 $ 1,200 $ 800 Cash from sale of old machine $ 200 $ 200 $ 200 Installation of new machine $ 75 $ 100 $ 100 Initial training cost in year 1 $ 350 $ 300 $ 250 Annual maintenance contract $ 300 $ 275 $ 200 Annual cost of supplies $ 200 $ 200 $ 200 Annual wage costs of employees $32,000 $32,000 $32,000
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