20% Single Payments TABLE 22 Discrete Cash Flow: Compound Interest Factors Uniform Series Payments 20% Arithmetic Gradients Present Sinking Compound Worth Fund Capital Compound Recovery n Amount F/P P/F A/F Amount F/A A/P Present Worth ΡΙΑ Gradient Gradient Present Worth Uniform Series P/G A/G 1 1.2000 0.8333 1.00000 1.0000 1.20000 0.8333 2 1.4400 0.6944 0.45455 2.2000 0.65455 1.5278 0.6944 0.4545 3 1.7280 0.5787 0.27473 3.6400 0.47473 2.1065 1.8519 0.8791 4 2.0736 0.4823 0.18629 5.3680 0.38629 2.5887 3.2986 1.2742 5 2.4883 0.4019 0.13438 7.4416 0.33438 2.9906 4.9061 1.6405 6 2.9860 0.3349 0.10071 9.9299 0.30071 3.3255 6.5806 1.9788 7 3.5832 0.2791 0.07742 12.9159 0.27742 3.6046 8.2551 2.2902 8 4.2998 0.2326 0.06061 16.4991 0.26061 3.8372 9.8831 2.5756 9 5.1598 0.1938 0.04808 20.7989 0.24808 4.0310 11.4335 2.8364 10 6.1917 0.1615 0.03852 25.9587 0.23852 4.1925 12.8871 3.0739 11 7.4301 0.1346 0.03110 32.1504 0.23110 4.3271 14.2330 3.2893 12 13 23 8.9161 0.1122 0.02526 39.5805 0.22526 4.4392 15.4667 3.4841 10.6993 0.0935 0.02062 48.4966 0.22062 4.5327 16.5883 3.6597 14 15 45 12.8392 0.0779 0.01689 59.1959 0.21689 4.6106 17.6008 3.8175 15.4070 0.0649 0.01388 72.0351 0.21388 4.6755 18.5095 3.9588 11.7 A mechanical engineer who designs and sells equipment that automates manual labor processes is offering a machine/robot combination that will significantly reduce labor costs associated with manufacturing garage-door opener transmitters. The equipment has a first cost of $170,000, an estimated annual operating cost of $54,000, a maximum useful life of 5 years, and a $20,000 salvage value anytime it is replaced. The existing equipment was purchased 12 years ago for $65,000 and has an annual operating cost of $78,000. At most, the currently owned equipment can be used 2 more years, at which time it will be auctioned off for an expected amount of $6000, less 33% paid to the company handling the auction. The same scenario will occur if the currently owned equipment is replaced now. Determine the defender and challenger estimates of P, n, S, and AOC in conducting a replacement analysis today at an interest rate of 20% per year.