The replacement of a planning machine is being considered by the Reardorn Furniture Company. (There is an indefinite future need for this type of machine.) The best challenger will cost

$25,000

for installation and will have an estimated economic life of

11

years and a

$1,800

MV at that time. It is estimated that annual expenses will average

$13,000

per year. The defender has a present BV of

$5,000

and a present MV of

$3000.

Data for the defender for the next three years are given below. Using a before-tax interest rate of

15%

per year, make a comparison to determine whether it is economical to make the replacement now.

YEAR MV AT END OF YEAR. BV AT END OF YAEAR. EXPENSES DURING THE YEAR

1	$2,000	$3,750	$20,000
2	1,750	2,500	27,000
3	1,500	1,250	34000

Fill in the table for the EUAC values for the defender for years 1-3. (Round to the nearest dollar.)

Year	EUAC
1	$enter your response here
2	$enter your response here
3	$enter your response here

THANK YOU