Question
A piece of onboard equipment has a first cost of $600,000, an annual cost of $92,000, and a salvage value that decreases to zero by
A piece of onboard equipment has a first cost of $600,000, an annual cost of $92,000, and a salvage value that decreases to zero by $150,000 each year of the equipments maximum useful life of 5 years. Assume the companys MARR is 10% per year.
(a)Determine the ESL by hand.
(b)Use a spreadsheet with a graph indicating the capital recovery, AOC, and total AW per year to determine the ESL.
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Cornerstones of Managerial Accounting
Authors: Mowen, Hansen, Heitger
3rd Edition
324660138, 978-0324660135
