eulate aboul the long-term effect the bonus plan is likely to have on the company. Recommend how to compensate managers in a way that discourages gamesmanship. 4 ATC 10-6 Spreadsheet Assignment Using Excet Kilby Company is considering the purchase of new automated manufacturing equipment that would cost $150,000. The equipment would save $42,500 in labor costs per year over its six-year life. At the end of the fourth year, the equipment would require an overhaul that would cost 25.000. The equipment would have a S7,500 salvage value at the end of its life. Kilby's cost of capital is 12 percent