Q#04: An assembly operation at a company requires $100,000 per year now in labor cost. A robot can be purchased and installed to automate this operation. The robot will cost $200,000 and will have no market value at the end of the 10 years study period. Maintenance and operation expenses of the robot are $ 64,000 per year. MARR for the company is the 12% per year. Use the internal rate of return method to determine if the robot is a justifiable investment.

Q#01: (a) MARR is also known as Hurdle Rate. Why?

Answer (b) Land is not considered as a depreciable property. Why?

Answer

(a) Explain the procedure for calculating Taxable Income of a firm. Answer

(b) What is a Capital Recovery (CR) amount factor? Answer: