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Question 15 1.2/3 pts Use the following Information to Answer the Questions Below Our Business is making a Decision Today for the Next 5 years,
Question 15 1.2/3 pts Use the following Information to Answer the Questions Below Our Business is making a Decision Today for the Next 5 years, to Either keep our OLD Truck or to Purchase a NEW Truck. Our Business has the following Information to Consider in making the Decision; OLD TRUCK Costs and Benefits 1. The Cost of the Old Truck was $100,000 and will last for another 5 Years 2. Maintenance on the Old Truck is $11,000 per year 3. Gas to Run the Old Truck is $12,000 per Year 4. The Old Driver is paid $35,000 per Year 5. The Old Truck Could be sold today for $35,000 6. The Old Truck can be sold in 5 years for $10,000 4. The Old Driver is paid $35,000 per Year 5. The Old Truck Could be sold today for $35,000 6. The Old Truck can be sold in 5 years for $10,000 7. The Old Truck Insurance Costs are $6,000 per Year NEW TRUCK Costs and Benefits 1. The Cost of the New Truck would be $200,000 and will last for 5 years. 2. The new Truck can be sold in 5 years for $55,000 3. The Maintenance of the New Truck would be Zero for the First 3 years and then $7,000 per year after 4. The Gas Cost of the New Truck is $9,000 per year 5. The New Driver is paid $30,000 per year 6. New Truck Insurance Costs are $5,000 per Year Compute the Total NET Relevant (Cost) or Benefit to Keep the Old Truck Compute the Total NET Relevant (Cost) or Benefit to Buy the New Truck Should We keep the Old Truck or Buy the New Truck ? Compute the Dollar Benefit to your Decision What is One Qualitative Benefit to Buying the New Truck
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