A currently owned shredder used in a refuse-powered electrical generating plant has a present net realizable value of $200,000 and is expected to have a market value of $10,000 after 4 years. Operating and maintenance disbursements are $100,000 per year. An equivalent shredder can be leased for $200 per day plus $80 per hour of actual use as determined by an hour meter, with both components assumed to be paid at year-end. Actual use is expected to be 1,500 hours and 250 days per year. Using a 4-year planning horizon, a before-tax analysis, and a MARR of 15%, determine the preferred alternative using the annual cost criterion.

Chapter 07, Problem 007 A currently owned shredder used in a refuse-powered electrical generating plant has a present net realiza e value of S 0 00 and is expected to have a market va e of o after 4 ears. Operating and maintenance disbursements are $100,000 per year. An equivalent shredder can be leased for $200 per day plus $80 per hour of actual use as determined by an hour meter, with both components assumed to be paid at year-end. Actual use is expected to be 1,500 hours and 250 days per year. Using a 4-year planning horizon, a before-tax analysis, and a MARR of 15%, determine the preferred alternative using the annual cost criterion. Click here to access the TVM Factor Table Calculator Part a) Consider only the information in the original problem statement, and use the cash flow approach (insider's viewpoint approach) Show the EUAC values used to make your decision Keep existing shredder:s Lease equivalent shredder: Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is 50. Preferred alternative Lease equivalent shredder Keep existing shredder