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Q6 DG Industry plans to buy a new CNC lathe machine from China. The cost estimation of three type CNC machines at similar performance are
Q6 DG Industry plans to buy a new CNC lathe machine from China. The cost estimation of three type CNC machines at similar performance are shown in Table Q6. Given the MARR is 20% per annum Table Q6: Manufacturers, lives and costs of three lined slurry pump CNC Chocu CNC Alpax CNC Bzex Capital Investment RM 32,000 RM 42,500 RM 37,000 Annual Expenses: RM 4,200 RM 1,500 RM 2,800 Electrical Energy RM 1,900 in year RM 900 in year 1, RM 1,500 in year Maintenance 1, and increasing and increasing RM 1, and increasing RM 750/yr 400/yr thereafter RM 350/yr thereafter thereafter Useful life (years) 6 10 8 Market Value RM 1,000 RM 7,500 RM 3,500 (Disposal Cost) (a) Draw cash-flow diagrams for each machine. (9 marks) (b) Estimate the annual worth (AW) for each machine. (12 marks) (c) Justify which machine should be selected (4 marks)
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