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please help me with this question as do not know 4. The table below details three possible alternatives to replace existing machinery The life of
please help me with this question as do not know
4. The table below details three possible alternatives to replace existing machinery The life of each alternative is 5 years. Assuming the cost of capital is 10%, depreciation for tax purposes of capital expenditure is allowable at 30% on a declining balance basis and the effective tax rate is 45%. Determine the preferred alternative. Alternative Salvage value $ A B Capital Expenditure $ 700,000 900,000 1,300,000 Annual Operating cost $ 200,000 130,000 70,000 100,000 150,000 300,000Step by Step Solution
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