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Engineering Economy A company is considering the purchase of a large stamping machine that will cost exist185,000, plus exist4, 700 transportation and exist9, 300 installation
Engineering Economy
A company is considering the purchase of a large stamping machine that will cost exist185,000, plus exist4, 700 transportation and exist9, 300 installation charges. It is estimated that, at the end of five years, the market value of the machine will be exist32,000. The IRS has established that this machine will fall under a three-year MACRS class life category. The justifications for the machine include exist26.000 savings per year in labor and exist36,000 savings per in reduced materials. The before-tax MARR is 20% per year, and the effective income tax rate is 40%. What is the after-tax equivalent annual worth of this investment over the five year period which ends with the sale of the machine? (Do not enter a dollar sign exist with your answer.)
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