Randall UPS is a supplier of a variety of services for small businesses. Commercial printer, scanning, and copier equipment is being considered to replace a five$-$year$-$old machine. After the initial screening of a variety of systems, two integrated systems remain as potential replacements $-$ a new model from Konica Minolta and an updated and enhanced reconstructed model from Ricoh. The relevant information on the two machines are as follows:

Konica Minolta Ricoh

Installed Price $$24,500$ $$25,500$

Estimated costs $$4,300$ plus $$0\mathrm{.}015/$copy $$7,050$

Estimated salvage value $$10,500$ $$12,500$

Estimated useful life $5$ years $5$ years

Randall expects to charge customers $$0\mathrm{.}06$ per copy and sell $250,000$ copies annually; however, they are uncertain about their service volume estimate. The $$0\mathrm{.}06$ per copy they expect to charge customers and the maintenance & usage fees are not expected to change over the next five years. Randall requires a minimum pre$-$tax rate of return of $15\%$ on its equipment investments.

REQUIREMENTS

$1.$ Using the NPV function in Excel determine the Net Present Value $($NPV$)$ for the Konica Minolta system for estimated volumes starting from $200,000$ copies$/$year to $300,000$ copies$/$year$,$ in increments of $5,000$ copies.

$2.$ Using the NPV function in Excel determine the $($NPV$)$ for the Ricoh system for estimated volumes starting from $200,000$ copies$/$year to $300,000$ copies$/$year$,$ in increments of $5,000$ copies.

$3.$ From your answers to the above, determine which copier you would recommend to Speedy at an annual volume of $2100,000,240,000,$ & $280,000$ copies

$4.$ Explain why the decision is different at different volumes.