A company is going to buy a new equipment for manufacturing its product. Four different equipment’s are available; costs, operating and other expenses are as follows: Equipment A B C D First Cost Php 24,000 Php 30,000 Php 49,600 Php 52,000 Power per year Php 1300 Php 1360 Php 2400 Php 2520 Labor per year Php 10,600 Php 9320 Php 4200 Php 2700 Maintenance/year Php 2800 Php 1900 Php1300 Php 700 Taxes & Insurance 2% 2% 2% 2% Life; years 5 5 5 5 Money is worth 10% before taxes to the company. Which equipment should be purchased ? Choose which method is applicable.
A company is going to buy a new equipment for manufacturing its product. Four different equipment’s are available; costs, operating and other expenses are as follows: Equipment A B C D First Cost Php 24,000 Php 30,000 Php 49,600 Php 52,000 Power per year Php 1300 Php 1360 Php 2400 Php 2520 Labor per year Php 10,600 Php 9320 Php 4200 Php 2700 Maintenance/year Php 2800 Php 1900 Php1300 Php 700 Taxes & Insurance 2% 2% 2% 2% Life; years 5 5 5 5 Money is worth 10% before taxes to the company. Which equipment should be purchased ? Choose which method is applicable.
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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A company is going to buy a new equipment for manufacturing its
product. Four different equipment’s are available; costs, operating and other
expenses are as follows:
Equipment A B C D
First Cost Php 24,000 Php 30,000 Php 49,600 Php 52,000
Power per year Php 1300 Php 1360 Php 2400 Php 2520
Labor per year Php 10,600 Php 9320 Php 4200 Php 2700
Maintenance/year Php 2800 Php 1900 Php1300 Php 700
Taxes & Insurance 2% 2% 2% 2%
Life; years 5 5 5 5
Money is worth 10% before taxes to the company. Which equipment should
be purchased ? Choose which method is applicable.
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