Question
My question is not about below question per say. I need help in understanding when to use Exhibit 13B1 and 13B2. For example, I was
My question is not about below question per say. I need help in understanding when to use Exhibit 13B1 and 13B2. For example, I was told that I need to use Exhibit 13B-2 for the below problem, but I am not sure why or the difference. I have other problems that I need to do so I am hoping to better understand the difference between the 2. Thanks. PLEASE DO NOT ANSWER THE BELOW QUESTION. PLEASE SEE PREVIOUS EXPLANATION OF WHAT I NEED.
- The management of Opray Corporation is considering the purchase of a machine that would cost $360,000, would last for 7 years, and would have no salvage value. The machine would reduce labor and other costs by $78,000 per year. The company requires a minimum pretax return of 11% on all investment projects. (Ignore income taxes.)
See separate Exhibit 13B-1 and Exhibit 13B-2, to determine the appropriate discount factor(s) using the tables provided.
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