Homework Answers
We need to annualize the salvage and initial cost
EUAC(A) = PMT(0.5,5,-16000) + 1450 - PMT(0.5,5,-1900) = 10519.19
EUAC(B) = PMT(0.5,5,-59000) + 1050 - PMT(0.5,5,-5900) = 34576.54
EUAC(B) - EUAC(A) = 34576.54-10519.19 = 24057.35
Add Answer to:
Machine A was purchased last year for $10,000 and had an estimated market value of $1,900...
5 years ago, a multi-axis NC machine was purchased for the express purpose of machining large,...
5 years ago, a multi-axis NC machine was purchased for the express purpose of machining large, complex parts used in commercial and military aircraft worldwide. It cost $350,000, had an estimated life of 15 years, and O&M costs of $50,000 per year. It was originally thought to have a salvage value of $20,000 at the end of 15 years but is now believed to have a remaining life of 5 years with no salvage value at that time. With business...
3. A machine is purchased for S70,000. Life is 10 years with a S 10,000 salvage. MARR is 10%, and...
please show work that is easy to UNDERSTAND
3. A machine is purchased for S70,000. Life is 10 years with a S 10,000 salvage. MARR is 10%, and the tax rate is 50%. Cash operating costs are $4500 per year. Five year MACRS (20, 32, 19.2. 11.52, 11.52,5.76) depreciation will be used. Calculate the annual equivalent revenue requirements for this machine.
3. A machine is purchased for S70,000. Life is 10 years with a S 10,000 salvage. MARR is 10%,...
A specialty concrete mixer used in construction was purchased for $300,000 7 years ago. It is...
A specialty concrete mixer used in construction was purchased for $300,000 7 years ago. It is MACRS-GDS 5-year property. Its annual O&M costs are $105,000. At the end of an 8-year planning horizon, the mixer will have a salvage value of $5,000. If the mixer is replaced, a new mixer will require an initial investment of $375,000, and at the end of the 8-year planning horizon, the new mixer will have a salvage value of $45,000. Its annual O&M cost...
A CNC machining center was purchased 6 years ago for $100,000. The current market value is...
A CNC machining center was purchased 6 years ago for $100,000. The current market value is $200,000, which will decline as follows over the next 5 years: $140,000, $130,000, $120,000, $100,000, and $80,000. The O&M costs are estimated to be $36,000 this year. These costs are expected to increase by $5,000 per year starting year 2. MARR = 10% Reference: Case Study 13 The EUAC for defender in year 2 is O A. $85,182 OB. $91,715 OC. $81,642 OD. $105,240
3. A machine tool costs $10,000 and does not have any salvage value. The manufacturer's warranty...
3. A machine tool costs $10,000 and does not have any salvage value. The manufacturer's warranty covers the maintenance and repair cost for the first year. The maintenance and repair costs for the second year will be $1,000 and will increase for $500 for the subsequent years. The operating costs for the first year will be $400 and will increase for $400 for the subsequent years. Consider an analysis period of 8 years and interest rate of 9%, and find...
A high-speed electronic assembly machine was purchased two years ago for $50,000. At the present ...
A high-speed electronic assembly machine was purchased two years ago for $50,000. At the present time, it can be sold for $26,000 and replaced by a newer model having a purchase price of $42,500; or it can be kept in service for a maximum of one more year. The new assembly machine, if purchased, has a useful life of not more than two years. If the before-tax MARR is 18%, when should the old assembly machine be replaced? Use the...
A new machine costs $25,000 and has the estimated maximum (physical) life of 5 years. It...
A new machine costs $25,000 and has the estimated maximum
(physical) life of 5 years. It also has the estimated salvage
(market) value (S) and operating and maintenance costs (O&M) in
each of the 5 years of use as shown below: Year n Sn O&Mn EACn
0 $25,000 1 $16,000 $5,000 $16,000 2 $13,000 $8,000 $14,212 3
$11,000 $11,000 $14,159 4 $10,000 $14,000 $14,541 5 $9,500 $17,000
$15,181 MCn $16,000 $12,280 $14,040 $15,880 $18,300 Suppose the
MARR is 8%. The...
12.22 Four years ago, a firm purchased an industrial batch oven for $23,000. The oven had...
12.22 Four years ago, a firm purchased an industrial batch oven for $23,000. The oven had an estimated life of 10 years with $1,000 salvage value. These original esti- mates are still good. If sold now, the machine will bring in $2,000. If sold at the end of the year, it will bring in $1,500. The market value after the first year has decreased at annual rate of 25%. Annual operating costs for subsequent years are $3,800. A new machine...
A five-year-old defender has a current market value of $4,000 and expected O&M costs of $3,400...
A five-year-old defender has a current market value of $4,000 and expected O&M costs of $3,400 this year, increasing by $1,200 per year. Future market values are expected to decline by $1,100 per year. The machine can be used for another three years. The challenger costs $6,500 and has O&M costs of $2,200 per year, increasing by $600 per year. The machine will be needed for only three years, and the salvage value at the end of that time is...
You are considering purchasing a CNC machine which costs $120,000. This machine will have an estimated...
You are considering purchasing a CNC machine which costs $120,000. This machine will have an estimated service life of 12 years with a net after-tax salvage value of $12,000. Its annual after-tax operating and maintenance costs are estimated to be $59,000. To expect an 16% rate of return on investment, what would be the required minimum annual after-tax revenues? Click the icon to view the interest factors for discrete compounding when i = 16% per year. The required minimum annual...
5 years ago, a multi-axis NC machine was purchased for the express purpose of machining large, complex parts used in commercial and military aircraft worldwide. It cost $350,000, had an estimated life of 15 years, and O&M costs of $50,000 per year. It was originally thought to have a salvage value of $20,000 at the end of 15 years but is now believed to have a remaining life of 5 years with no salvage value at that time. With business...
please show work that is easy to UNDERSTAND
3. A machine is purchased for S70,000. Life is 10 years with a S 10,000 salvage. MARR is 10%, and the tax rate is 50%. Cash operating costs are $4500 per year. Five year MACRS (20, 32, 19.2. 11.52, 11.52,5.76) depreciation will be used. Calculate the annual equivalent revenue requirements for this machine.
3. A machine is purchased for S70,000. Life is 10 years with a S 10,000 salvage. MARR is 10%,...
A CNC machining center was purchased 6 years ago for $100,000. The current market value is $200,000, which will decline as follows over the next 5 years: $140,000, $130,000, $120,000, $100,000, and $80,000. The O&M costs are estimated to be $36,000 this year. These costs are expected to increase by $5,000 per year starting year 2. MARR = 10% Reference: Case Study 13 The EUAC for defender in year 2 is O A. $85,182 OB. $91,715 OC. $81,642 OD. $105,240
3. A machine tool costs $10,000 and does not have any salvage value. The manufacturer's warranty covers the maintenance and repair cost for the first year. The maintenance and repair costs for the second year will be $1,000 and will increase for $500 for the subsequent years. The operating costs for the first year will be $400 and will increase for $400 for the subsequent years. Consider an analysis period of 8 years and interest rate of 9%, and find...
A high-speed electronic assembly machine was purchased two years ago for $50,000. At the present time, it can be sold for $26,000 and replaced by a newer model having a purchase price of $42,500; or it can be kept in service for a maximum of one more year. The new assembly machine, if purchased, has a useful life of not more than two years. If the before-tax MARR is 18%, when should the old assembly machine be replaced? Use the...
A new machine costs $25,000 and has the estimated maximum
(physical) life of 5 years. It also has the estimated salvage
(market) value (S) and operating and maintenance costs (O&M) in
each of the 5 years of use as shown below: Year n Sn O&Mn EACn
0 $25,000 1 $16,000 $5,000 $16,000 2 $13,000 $8,000 $14,212 3
$11,000 $11,000 $14,159 4 $10,000 $14,000 $14,541 5 $9,500 $17,000
$15,181 MCn $16,000 $12,280 $14,040 $15,880 $18,300 Suppose the
MARR is 8%. The...
12.22 Four years ago, a firm purchased an industrial batch oven for $23,000. The oven had an estimated life of 10 years with $1,000 salvage value. These original esti- mates are still good. If sold now, the machine will bring in $2,000. If sold at the end of the year, it will bring in $1,500. The market value after the first year has decreased at annual rate of 25%. Annual operating costs for subsequent years are $3,800. A new machine...
A five-year-old defender has a current market value of $4,000 and expected O&M costs of $3,400 this year, increasing by $1,200 per year. Future market values are expected to decline by $1,100 per year. The machine can be used for another three years. The challenger costs $6,500 and has O&M costs of $2,200 per year, increasing by $600 per year. The machine will be needed for only three years, and the salvage value at the end of that time is...
You are considering purchasing a CNC machine which costs $120,000. This machine will have an estimated service life of 12 years with a net after-tax salvage value of $12,000. Its annual after-tax operating and maintenance costs are estimated to be $59,000. To expect an 16% rate of return on investment, what would be the required minimum annual after-tax revenues? Click the icon to view the interest factors for discrete compounding when i = 16% per year. The required minimum annual...
Most questions answered within 3 hours.
-
A sample of C3H8 has 1.60×1024 H atoms.
How many carbon atoms does the sample contain?...
asked 45 minutes ago -
How many unique codes are possibly formed from two characters,
where the first character can be...
asked 15 minutes ago -
A concentration cell is built based on the reaction:
2H+ + 2e- ----> H2
The pH...
asked 11 minutes ago -
what is the ph of the following solutions?
150 g NH4CI dissolved into 10.0 mL of...
asked 22 minutes ago -
A projectile is launched with an initial speed of 40 m/s at an
angle of 25°...
asked 5 minutes ago -
1. Using a function, display the customer who has the highest
credit limit. Display the customer...
asked 14 minutes ago -
A spatially uniform electric field varies in time according
to E = Eo + 3000 t,...
asked 39 minutes ago -
An electric power station that operates at 25 kV and uses a 20:1
step-up ideal transformer...
asked 32 minutes ago -
1. If 0.02% of a 0.6 M weak acid ionizes in a solution, what is
the...
asked 19 minutes ago -
The College of Business at Northeast College is accumulating
data as a first step in the...
asked 25 minutes ago -
A flint glass plate (n = 1.66) rests on the bottom of an
aquarium tank. The...
asked 34 minutes ago -
The position in an object as a function of time is given as ?
(?) =...
asked 49 minutes ago