M/S X Ltd is planning to replace its furnance. It has received tenders from different

Manufacturers of furnance. The details are as follows.

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Manufacturer

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A B C

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Initial cost 76,00,000 65,00,000 80,00,000

Life(years) 10 10 10

Annual Income 8,00,000 9,00,000 8,50,000

Annual cost 50000 90000 80000

Salvage Value after

10 years 5,00,000 4,00,000 7,00,000

interest rate 12%

Which is the best method based on present worth method and annual worth