Question
14. The following costs are estimated for two equal-service machines: If the minimum required rate of return is 15% per year, which machine should be
14. The following costs are estimated for two equal-service machines: If the minimum required rate of return is 15% per year, which machine should be selected? (Show your work to justify answer)
Machine A Machine B
Cost $26,000 $36,000
Annual maintenance cost $800 $300
Annual Labor Cost $11,000 $7,000
Extra income -- $2,600
Salvage value $2,000 $3,000
Life, years 6 10
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Business And Personal Finance
Authors: McGraw-Hill
1st Edition
0078945801, 9780078945809
