. Using the concept of relevant costs over a five year period, which model is the...

 

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. Using the concept of relevant costs over a five year period, which model is the lowest cost alternative? Cost Estimated life Trade In value after 5 years Cash from sale of current machine Installation cost Training cost Annual labor cost Annual maintenance cost Annual supplies cost Total Relevant One-Time Costs Total Relevant Annual Costs Total Relevant Five Year Costs Recommendation: Model A $5,000 5 years 1,000 200 80 350 32,000 275 175 Model B $5,500 5 years 1,200 200 120 300 32,000 300 225 Model C $5,300 5 years 800 200 100 325 32,000 250 200 Relevant? One-Time? Annual? . Using the concept of relevant costs over a five year period, which model is the lowest cost alternative? Cost Estimated life Trade In value after 5 years Cash from sale of current machine Installation cost Training cost Annual labor cost Annual maintenance cost Annual supplies cost Total Relevant One-Time Costs Total Relevant Annual Costs Total Relevant Five Year Costs Recommendation: Model A $5,000 5 years 1,000 200 80 350 32,000 275 175 Model B $5,500 5 years 1,200 200 120 300 32,000 300 225 Model C $5,300 5 years 800 200 100 325 32,000 250 200 Relevant? One-Time? Annual?

Answer rating: 100% (QA)

Computation of cost of Trade Particular Model A Model B Model c Cost 5000 5500 5300 Relevant one tim... View the full answer