Accounting Assignment | Custom Assignment Help
October 9th, 2019
Consider the following EOY cash flows for two mutually exclusive alternatives. (one must be chosen)
- Alternative AAlternative B
- Capital investment (TL)400012000
- Annual expenses (TL)
- 28002300
- Useful life (years)36
- Market value at the end of29002900
- Useful life (TL)
The MARR is 8% per year.
a) Determine which alternative should be selected if the repeatability assumption applies. Use PW in your analysis.
PW (A) =?
PW (B) =?
Which one is preferred?
b) Determine which alternative should be selected if the analysis period is 6 years and the repeatability assumption does not apply. Use the AW method.
AW (A) =?
AW (B) =?
Which one is preferred?
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