ZuoTi.Pro
Question

A company recently purchased a new machine. The maintenance contractor recommended that this model should receive maintenance
business   accounting   
0 0
Add a comment Improve this question Transcribed image text
Next > < Previous
Sort answers by oldest

Homework Answers

Answer #1
Particulars Option 1 Option 2
Total Service hours 30000 Hrs 30000 Hrs
Maintenance Required on 3000 Hrs 5000 Hrs
No of Maintenance 10 6
Maintenance Cost per Maintenance $218 $218
Total Maintenance Cost $         2,180 $        1,308
Savings of Scheduling Maintenance every
5000 hours over 3000 hours		 $                                        872
0 0
Add a comment
Know the answer?
Add Answer to:
A company recently purchased a new machine. The maintenance contractor recommended that this model should receive...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions

  • A contractor wants to buy a new special equipment to complete his contractual obligations. He found...

    A contractor wants to buy a new special equipment to complete his contractual obligations. He found three models for this equipment available in the market. The descriptions of the cost for each model are shown in the table below. If the operating and maintenance costs of all models are expected to be the same and the MARR of the contractor is 10%, which model should the contractor select? M2 M3 Machine Initial cost Service life (years) M1 25,000 30,000 50,000...

  • One company bought a milling machine for $ 100,000. The company has the intention to use...

    One company bought a milling machine for $ 100,000. The company has the intention to use the machine for the next 5 years. The machine is expected to save the company $ 35,000 during the first year of operation. From then on the annual savings are expected decrease 3% every year due to maintenance costs. Assuming an operation of 3,000 hours per year and that the machine will have no residual value ("Salvage Value") at the end of the 5...

  • Calculator Abbott Company is considering purchasing a new machine to replace a machine purchased one year...

    Calculator Abbott Company is considering purchasing a new machine to replace a machine purchased one year ago that Is not achieving the expected results. The following information is available Expected maintenance costs of new machine Purchase price of existing machine Expected cost savings of new machine Expected maintenance costs of existing machine Resale value of existing machine $12,000 per year $150,000 $20,000 per year $8,000 per year $35,000 Which of these items is irrelevant? a. Purchase cost of existing machine...

  • Please solve by hand . DO NOT SOLVE USING EXCEL QUESTION 6 GMC purchased a $180,000...

    Please solve by hand . DO NOT SOLVE USING EXCEL QUESTION 6 GMC purchased a $180,000 milling machine, which will be used for years. The machine is expected to save the company $30,000 during th first year of operation. Then, the annual savings is expected to DECREASE by 3% per year over the previous year due to additional cos of maintenance. The machine is to be operated 5,000 hours per yea (on average) and the machine is expected to have...

  • A contractor has purchased a wheeled loader for $130,000 and expects to use the loader an...

    A contractor has purchased a wheeled loader for $130,000 and expects to use the loader an average of 1,500 hours per year. Tires cost $6,000 to replace (estimated to occur after each 4,500 hours of use), and major repairs will be needed every 6,000 hours at a cost of $5,000. The contractor expects to be able to sell the loader for $10,000 after she has used it for 15,000 operating hours. Fuel, oil, and minor maintenance cost about $19.75 for...

  • 32.Abbott Company is considering purchasing a new machine to replace a machine purchased one year ago...

    32.Abbott Company is considering purchasing a new machine to replace a machine purchased one year ago that is not achieving the expected results. The following information is available: Expected maintenance costs of new machine $12,000 per year Purchase price of existing machine $150,000 Expected cost savings of new machine $20,000 per year Expected maintenance costs of existing machine $8,000 per year Resale value of existing machine $35,000 Which of these items is irrelevant? a. Expected resale value of existing machine...

  • Corporation purchased a printing machine three (3) years ago and is considering replacing it with a...

    Corporation purchased a printing machine three (3) years ago and is considering replacing it with a new one which is faster and easier to operate. The old machine has been depreciated over 3 years using straight-line depreciation. Its original installation cost was $15,000. The old machine has been in use for 2 years, and it can be traded in for $3,500. The new machine will be purchased $24,000 and it will also be depreciated over 3 years using the straight-line...

  • Question 6 (10 points): A new machine can be purchased today for $400,000. The annual revenue...

    Question 6 (10 points): A new machine can be purchased today for $400,000. The annual revenue from the machine is calculated to be $77,000, and the equipment will last 10 years. Expect the maintenance and operation costs to be $4,000 a year and to increase $700 per year. The salvage value of the machine will be $30,000. a) Draw a cash flow diagram for this project. b) What is the rate of return for this machine?

  • Simon is the product manager for Packaging Plus. Simon purchased a new packaging machine for $125,000...

    Simon is the product manager for Packaging Plus. Simon purchased a new packaging machine for $125,000 to save on labor costs. The first year, the machine worked well and the company was able to save $60,000, with machine operating and maintenance expenses of $25,000. The second year, operating expenses were slightly higher at $28,000, but savings increased to $80,000. The third year, expenses increased again to $30,000, and savings decreased to $65,000. The fourth year, the machine began to experience...

  • Nikky Co. is considering replacing an old machine with a new one. The old one was...

    Nikky Co. is considering replacing an old machine with a new one. The old one was purchased 3 years ago for $200,000. It is depreciated straight-line to zero over its 10-year life. It is expected to be worth of 85,000 three years later. If Nikky sells it today, Nikky should receive $150,000 for the old machine. The new machine costs $300,000. It has a life of 5 years and will be depreciated straight-line to zero over its 5-year life. It...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT