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Interstate Manufacturing is considering either replacing one of its old machines with a new machine or hoving the old machine overhauled. Information about the two

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Interstate Manufacturing is considering either replacing one of its old machines with a new machine or hoving the old machine overhauled. Information about the two alternatives follows. Management requires a 8% rate of return on its investments. (PV of S1) PV of S1. PVA of S1, and FVA of Sin (Use appropriate factor(s) from the tables provided.) Alternative 1: Keep the old machine and hove it overhauled if the old machine is overhauled, it will be kopt for another five years and then sold for its salvage value. Alternative 2: Sell the old machine and buy a now one. The new machine is more efficient and will yield substantial operating cost savings with more product being produced and sold. Required

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