Question

Radio Station CJXT is considering replacing its old, fully depreciated sound mixer. Two new models are available. Mixer X has a cost of $500,000, a five-year expected life, and after-tax cash flow savings of $120,000 per year. Mixer Y has a cost of $650,000, an eight-year life, and after-tax cash flow savings of $140,000 per year. No new technological developments are expected. The cost of capital is 13 percent. Should CJXT replace the old mixer with X or Y?


$1.99
Sales0
Views46
Comments0
  • CreatedJune 17, 2015
  • Files Included
Post your question
5000