You are invited to attend a management meeting by your company to decide on the future direction of the Plant and Machinery Unit. The Plant and Machineries Unit is being managed as profit centre. The plants and machineries are for the company's own use and also being rented out to other companies. A special account is created for the unit. The company will normally sell the plants and machineries after five years and replace them with a new one to reduce the maintenance cost. Certain amount of the income shall be set aside as sinking fund so that the company can buy the replacement by cash when the time comes. (5 marks) c) The company is in a dilemma whether to buy a new excavator or to rent it from other company. The price of a new excavator is RM 550,000. The salvage value at the end of five year is estimated to be around RM 50,000. The total cost to operate and to maintain the excavator is estimated at RM 5,000 per month. The company is taking hire purchase loan for the excavator and is expected to pay RM100,000 interest for the 5 years period. Determine the minimum number of days the excavator has to work in a year that will make the purchasing of the excavator financially attractive. Assume the rental rate of the excavator is RM800 per day. Advice the company whether to buy or rent the excavator