Bonka Toys is considering a robot that will cost $20,000 to buy After 7 years its salvage value will be $2000 An overhaul costing $5000 will be needed in year 4 O M costs will be $2500 per year Draw the cash flow diagram ...

Year Capital Costs 0 M Overhaul 000 20 0 0 ...

Bonka Toys is considering a robot that will cost $20,000 to buy. After 7 years its salvage

Question:

Bonka Toys is considering a robot that will cost $20,000 to buy. After 7 years its will be $2000. An overhaul costing $5000 will be needed in year 4. O&M costs will be $2500 per year. Draw the cash flow diagram.
Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...