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Three mutually exclusive design are being considered. The estimated sales and cost data for each alternative are given below. The MARR is 20% per year.
Three mutually exclusive design are being considered. The estimated sales and cost data for each alternative are given below. The MARR is 20% per year. Annual revenues are based on the number of units sold and the selling price. Annual expenses are based on fixed and variable cost. Determine which selection is preferable. (Method to use: ROR, AW/AC, PW/PWC, EUAW/EAUC, CC) A B C Investment Cost $30,000 $60,000 $50,000 Estimated units to 15,000 20,000 18,000 Be Sold/year Unit Selling price, $3.50 $4.40 $4.10 $/unit Variable Cost, $1.00 $1.40 $1.15 $/unit Annual expenses(fixed) $15,000 $30,000 $26,000 Market Value 0 $20,000 $15,000 Useful Life 10 years 10 years 10 years
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