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need help with this one problem At the beginning of last year (2021), Richter Condos installed a mechanded elevator for its tenants. The owner of
need help with this one problem
At the beginning of last year (2021), Richter Condos installed a mechanded elevator for its tenants. The owner of the company, Ron Richter, recently returned from an industry equipment ibition where he watched a computerized elevator demonstrated. He was impressed with the elevator's speed. comfort of ride, and cost efficiency Upon returning from the exhibition he asked his purchasing agent to collect price and operating cost data on the new elevator. In addition he asked the company's accountant to provide his with cost data on the company's elevator. This information is presented here. Old Elevator New Elevator Purchase price Estimated salvage value $98.500 $159.000 0 0 Estimated useful life Syears 4 years Straight line Straight line Depreciation method Annual operating costs other than depreciation Variable $34.400 $11.000 Fixed 22.400 8.600 Annual revenues are $240.000, and selling and administrative expenses are $28.000. regardless of which elevator is used if the old elevator is replaced now at the beginning of 2022. Richter Condos will be able to sell it for $24.700 Step by Step Solution
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