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www.considering investing in a new testing device. It has two options: Option A would have a lower initial cout but would require significant expenditure for
www.considering investing in a new testing device. It has two options: Option A would have a lower initial cout but would require significant expenditure for being the years ecete is expected to have a residual value at the end of its useful life. The following estimates were provided Option A Option B $90,000 $215,000 SI 80,000 $140,000 Acash outflows $160,000 S108,000 Cost to rebuild (end of year 4) $18,000 0 0 $42.000 Estimated useful life 8 years 10 years comment factors that must be taken into consideration for any investment decision making activity (5 marks) presente (PV) for each option. SHOW ALL RELEVANT CASH FLOWS AND WORKING CLEARLY (6 marks) ther with any other relevant data in the table above justify which option should be cepted? (4 Marks)
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