Equipment purchased 2 years ago by Newport Corporation to make pneumatic vibration isolators cost $80,000. It has a market value that can be described by the relation $80,000 $7,400k, where k is the years from time of purchase. The operating cost for the first 5 years is $60,000 per year, after which it increases by $6,400 per year. The assets salvage value was originally estimated to be $7000 after a predicted 10-year useful life. Determine the values of P, S, and AOC if (a) a replacement study is done now and it is assumed that the equipment will be kept a maximum of one more year, and (b) a replacement study is done 5 years from now and it is assumed that the equipment will be kept a maximum of only one more year after that.

a)

The value of P is $(?).

The value of S is $ (?).

The value of AOC is $ (?).

b)

The value of P is $ (?).

The value of S is $ (?).

The value of AOC is $ (?).