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Esquire Company needs to acquire a molding machine to be used in its manufacturing process. Two types of machines that would be appropriate are presently

Esquire Company needs to acquire a molding machine to be used in its manufacturing process. Two types of machines that would be appropriate are presently on the market. The company has determined the following:

Machine A could be purchased for $55,000. It will last 10 years with annual maintenance costs of $1,900 per year. After 10 years the machine can be sold for $5,775.

Machine B could be purchased for $50,000. It also will last 10 years and will require maintenance costs of $7,600 in year three, $9,500 in year six, and $11,400 in year eight. After 10 years, the machine will have no salvage value.

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