Question: i need help plz 1. Show your calculations clearly. 2. Draw the cash flow diagrams wherever necessary. 3. Attach Excel printouts wherever appropriate and necessary.


1. Show your calculations clearly. 2. Draw the cash flow diagrams wherever necessary. 3. Attach Excel printouts wherever appropriate and necessary. 4. Comment on the results when it is appropriate. A machine purchased 9 years ago for $45,000 is expected to have the salvage values and operating costs as shown below. It can be disposed of now at a market value of $8,000. A replacement machine will cost $125,000 and will have a $10,000 salvage value after its 10-year life. Its annual operating cost is expected to be $31,000. At an interest rate of 15% per year, determine how many more years, if any, the company should retain the existing machine. Year Salvage Value at End of Year, $ Operating Cost, S/Year 1 2 3 6,000 4,000 1,000 50,000 53,000 60,000
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
