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Pizza Palace is a pizza restaurant known for its posh d cor and its brick - oven pizza. Pizza Palace has five brick ovens that
Pizza Palace is a pizza restaurant known for its posh dcor and its brickoven pizza. Pizza Palace has five brick ovens that need attention and is considering two options. Both options will cost around $initial investment Option is to refurbish its current brickovens. If refurbished, Pizza Palace expects the ovens to last another years. The average annual income from refurbishing the ovens is $ Refurbishing the ovens will have no salvage value. Option is to replace the current ovens. New ovens would last years and have no salvage value. The average annual income from buying a new oven is $ Pizza Palace expects the following net cash inflows from the two options:
Year Refurbish Current Ovens Purchase New Ovens
$ $
$ $
$ $
$ $
$ $
$ $
$
$
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