10-point question Background Info: Scheduled production per 8-hour shift = 55,000 units Labor Cost per 8-hour shift = $21.000 Benefits per 8-hour shift = 36% of labor cost Annual Production Forecast = 14,300,000 units We are looking to purchase a piece of equipment that our Engineering Department has recommended. Engineering estimates the proposed equipment will reduce labor and benefit expenses by 7.5%. The additional, annual operating cost for the proposed equipment, including depreciation, energy consumption, and maintenance, is estimated to be $450,000 Using the background information given above, calculate the combined labor and benefits per year for the existing equipment and for the proposed equipment Show your work. Cost of labor and benefits for existing equipment for 1 year = Cost of labor and benefits for proposed equipment for 1 year Cost difference per year = . What decision would you make? Get the new or keep the old