Equivalent Annual Cost Assignment | Homework For You
May 21st, 2020
When a machine is worn out, it will be replaced with another machine, since it is integral to the operations of the business. The discount rate is 9%. The CFO has collected the following information on two possible choices:
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Equivalent Annual Cost Assignment | Homework For You
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Machine A Machine B
Initial cost 220,000 190,000
Useful Life 17 years 20 years
Annual maintenance 1,900 3,000
Calculate the equivalent annual cost of each machine.
EAC A _______________ EAC B _________________
Which machine should Specialty Clothing Corporation choose? ____________Get Finance homework help today