Question
Hercules Exercise Equipment Co. purchased a computerized measuring device two years ago for $54,000. The equipment falls into the five-year category for MACRS depreciation and
Hercules Exercise Equipment Co. purchased a computerized measuring device two years ago for $54,000. The equipment falls into the five-year category for MACRS depreciation and can currently be sold for $22,800. A new piece of equipment will cost $144,000. It also falls into the five-year category for MACRS depreciation. Assume the new equipment would provide the following stream of added cost savings for the next six years. Use Table 1212. Use Appendix B for an approximate answer but calculate your final answer using the formula and financial calculator methods.
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