A company is investigating three alternatives as follows: Ho Alternative A Initial cost $60,000 Annual Benefits $32,000 Salvage Value $10,000 Useful life, years 2 Alternative B $40,000 $16,000 $9,000 3 Alternative C $50,000 $17,000 $9,000 6

FINANCIAL ACCOUNTING
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Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Can someone please help me to solve the following question in excel with a file laid out like this for each alternative and follow all directions. please and thank you!!!!
A company is investigating three alternatives as follows: Ho
Alternative A
Alternative B
Alternative C
Initial cost
$60,000
$40,000
$50,000
Annual Benefits
$32,000
$16,000
$17,000
Salvage Value
$10,000
$9,000
$9,000
Useful life, years
2
3
6
a) Draw Cash flow diagram for each alternative?
b) Which machine is preferable on the basis of PRESENT WORTH ANALYSIS if i=4% per year?
(Assume the selected alternative will be repeated each life cycle, in exactly the same manner
Transcribed Image Text:A company is investigating three alternatives as follows: Ho Alternative A Alternative B Alternative C Initial cost $60,000 $40,000 $50,000 Annual Benefits $32,000 $16,000 $17,000 Salvage Value $10,000 $9,000 $9,000 Useful life, years 2 3 6 a) Draw Cash flow diagram for each alternative? b) Which machine is preferable on the basis of PRESENT WORTH ANALYSIS if i=4% per year? (Assume the selected alternative will be repeated each life cycle, in exactly the same manner
Year First Cost Annual Benefit
0
2
3
5
Salvage
Pwa
Cash flow, $
Year
0
1
2
3
4
5
First Cost
Annual Benefit
Salvage
PWb
Cash flow, $
0
P
Year
Q
First Cost
R
S
Annual Benefit Salvage
Cash flow, $
Transcribed Image Text:Year First Cost Annual Benefit 0 2 3 5 Salvage Pwa Cash flow, $ Year 0 1 2 3 4 5 First Cost Annual Benefit Salvage PWb Cash flow, $ 0 P Year Q First Cost R S Annual Benefit Salvage Cash flow, $
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