ommunication Case Viable Corp. purchases machines for use in its plant. Machine Type A is typical of these ma- chines. Currently, Viable is considering the purchase of a new TypeA machine. Two different brand names are being considered. Viable expects a 12% return on its plant investments. Brand ABrand B Cost (cash basis)... $100,000$90,000 Operating expense to operate the machine (per year). . . .$7,000$8,000 Estimated useful life (years).... .......88 Estimated residual value (% of cost)... ..20%10% Required a.Compute the present value of the costs of the two alternative brands of machines. (Assume that all variables, other than the four listed above, are identical for both brands.) b.Which machine should Viable purchase? Are any other factors besides our computations relevant? Prepare the response in memo form to senior management Viable Corp. purchases machines for use in its plant. Machine Type A is typical of these ma chines. Currently, Viable is considering the purchase of a new Type A machine. Two different brand names are being considered. Viable expects a 12% return on its plant investments Brand B Brand A $100,000 57.000 8 20% Costos Operating expense to operate the machine per year)... Estimated selle tyears) Estimated residual of S90.000 9.000 10% Required a.Compute the present value of the costs of the two alternative brands of machines. (Assume that all variables, other than the four listed above, are identical for both brands.) b. Which machine should Viable purchase? Are any other factors besides our computations relevant? Prepare the response in memo form to senior management Viable Corp. purchases machines for use in its plant. Machine Type A is typical of these ma chines. Currently, Viable is considering the purchase of a new Type A machine. Two different brand names are being considered. Viable expects a 12% return on its plant investments Cost cash basis) Operating expense to operate the machine per year) Estimated out the years) Estimated residual Brand A $100,000 57.000 BrandB 890.000 $8.000 20% 10% Required a) Compute the present value of the costs of the two alternative brands of machines (Assume that all variables, other than the four listed above, are identical for both brands). b) Which machine should Viable purchase? Are any other factors besides our computations relevant? Prepare the response in memo form to senior management