X ltd is considering the purchase of a new machine. Two alternatives are available having a...
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X ltd is considering the purchase of a new machine. Two alternatives are available having a cost price Rs. 200000 each. The following inflows are expected during the five years life of both the machines are 5 years. Year 1 2 3 4 5 Machine A 15,000 20,000 25,000 15,000 10,000 The company is expecting 10% returns on its capital. The net present value of Rs. 1 @ 10% are given as follows 1st year 0.909 2nd year 0.826 3rd year 0.751 4th year 0.683 0.620 5th year You are required to appraise the proposals on the basis of 1. Pay back period method Machine B 5,000 15,000 20,000 30,000 20,000 X ltd is considering the purchase of a new machine. Two alternatives are available having a cost price Rs. 200000 each. The following inflows are expected during the five years life of both the machines are 5 years. Year 1 2 3 4 5 Machine A 15,000 20,000 25,000 15,000 10,000 The company is expecting 10% returns on its capital. The net present value of Rs. 1 @ 10% are given as follows 1st year 0.909 2nd year 0.826 3rd year 0.751 4th year 0.683 0.620 5th year You are required to appraise the proposals on the basis of 1. Pay back period method Machine B 5,000 15,000 20,000 30,000 20,000
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Related Book For
Engineering Economy
ISBN: 978-0132554909
15th edition
Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
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