Group 4 Alternative 1 |Alternative 2 Alternative 3 Cost of New Machine $2,800,000 $2,000,000 $1,500,000 Estimated Useful Life 8 Years 10 years 9 years Operating Costs each year $90,000 $190,000 $70,000 Warranty covers years 1-4 Maintenance Years 5-10 $16,000 $25,000 $35,000 Training for employees $0 $25,000 $35,000 Expected revenues generated years 1-3 $400,000 $500,000 $350,000 Expected revenues generated years 4-6 $350,000 $550,000 $350,000 Expected revenues generated years 7-10 $250,000 $300,000 $300,000 Estimated Salvage Value $25,000 $10,000 $50,000 Use straight-line depreciation to include tax savings from depreciation Tax rate 20%