Solve the following problems on replacement analysis, comparing alternatives and depreciation. Please solve the problem MANUALLY.

A small high-speed commercial centrifuge has the following net cashows and abandonment values over its

useful life (see the table). The rm's MARR is 10% per year. Determine the optimal time for the centrifuge to

be abandoned if its current MV is 75,000 and it won't be used for more than ve years.

End of Year

1 2 3 4 5

Annual revenues less expenses 20,000 20,000 20,000 20,000 20,000

Abandonment value of machine 62,000 52,000 40,000 22,000 0