Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A firm can purchase a centrifugal separator (5-year MACRS property)for $17,000. The estimated salvage value is $3,200 after a useful life of six years. Operating

image text in transcribedimage text in transcribedimage text in transcribed

A firm can purchase a centrifugal separator (5-year MACRS property)for $17,000. The estimated salvage value is $3,200 after a useful life of six years. Operating and maintenance (O&M) costs for the first year are expected to be $1,700. These O&M costs are projected to increase by $1,500 per year each year thereafter. The income tax rate is 25% and the MARR is 13% after taxes. What must the uniform annual benefits be for the purchase of the centrifugal separator to be economical on an after-tax basis? 77-6 6 6 6 6 6 6 6 6 6 3 881-89 655 7 2 5033 5 999-9 2 2 5555-55555-2 0 00000-00000-00000|0 755 2 111100 r" 9 9 9 9 3236 44999 728 88 12-10-00 42 4 7-00000000 r" 0 0 0 002 5000000 3511 7 0 0-1 2 3 4 5 6 7 8 9 0 1 10- ea-1 2 3 4 5 6 7 8 9 Discrete Compounding; i-13% Single Payment Uniform Series Sinking Fund Factor To Find A Given F A/F 1.0000 0.4695 0.2935 0.2062 0.1543 0.1202 0.0961 0.0784 0.0649 0.0543 Compound Amount Compound Amount Factor To Find F Given A F/A 1.0000 2.1300 3.4069 4.8498 6.4803 8.3227 10.4047 12.7573 15.4157 18.4197 Capital Recovery Factor To Find A Given P A/P 1.1300 0.5995 0.4235 0.3362 0.2843 0.2502 0.2261 0.2084 0.1949 0.1843 Present Present Worth Factor To Find P Given A P/A 0.8850 1.6681 2.3612 2.9745 3.5172 3.9975 4.4226 4.7988 5.1317 5.4262 Factor Worth Factor To FindF To Find P Given P F/P 1.1300 1.2769 1.4429 1.6305 1.8424 2.0820 2.3526 2.6584 3.0040 3.3946 Given F P/F 0.8850 0.7831 0.6931 0.6133 0.5428 0.4803 0.4251 0.3762 0.3329 0.2946 4 10

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

More Books

Students also viewed these Finance questions

Question

What do they not do so well?

Answered: 1 week ago