To pom You have purchased a sand blaster booth for $10,000. The equipment has a useful...

 

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To pom You have purchased a sand blaster booth for $10,000. The equipment has a useful life of 8 years and will be depreciated to zero using the SOYD method over that period of time. Assume that the salvage in year n is equal to the book value (i.e., zero after the depreciation). In the first year, operating costs are expected to be $1000, increasing by 30% in each subsequent year (this means simply a linear increase of costs each year). a. Draw the cash flow diagram without considering depreciation. This method will help you understand what is going on for costs and investments. b. If your MARR is 10% , then what is the economic life of the equipment? c. Attach a file containing your diagram, calculations and your economic life answer. An Excel file, with proper notations and diagrams, is acceptable. To pom You have purchased a sand blaster booth for $10,000. The equipment has a useful life of 8 years and will be depreciated to zero using the SOYD method over that period of time. Assume that the salvage in year n is equal to the book value (i.e., zero after the depreciation). In the first year, operating costs are expected to be $1000, increasing by 30% in each subsequent year (this means simply a linear increase of costs each year). a. Draw the cash flow diagram without considering depreciation. This method will help you understand what is going on for costs and investments. b. If your MARR is 10% , then what is the economic life of the equipment? c. Attach a file containing your diagram, calculations and your economic life answer. An Excel file, with proper notations and diagrams, is acceptable.

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Question A Sand Booth is purchased for 10000 The useful life of the machine is 8 years Salvage V... View the full answer