A portable concrete instrument used in construction for evaluating and profiling concrete surfaces (MACRS-GDS 5-year property class) is under consideration by a construction firm for $26,000. The instrument will be used for 6 years and be worth $2,250 at that time. The annual cost of use and maintenance will be $6,500. Alternatively, a more automated instrument (same property class) available from the manufacturer costs $29,500, with use and maintenance costs of only $7,500 and salvage value after 6 years of $3,000. The marginal tax rate is 40%, and MARR is an after-tax 12%. Determine which alternative is less costly, based upon comparison of after-tax annual worth. Show the AW values used to make your decision: Alternative 1: $ Alternative 2: S Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is ±3%.
A portable concrete instrument used in construction for evaluating and profiling concrete surfaces (MACRS-GDS 5-year property class) is under consideration by a construction firm for $26,000. The instrument will be used for 6 years and be worth $2,250 at that time. The annual cost of use and maintenance will be $6,500. Alternatively, a more automated instrument (same property class) available from the manufacturer costs $29,500, with use and maintenance costs of only $7,500 and salvage value after 6 years of $3,000. The marginal tax rate is 40%, and MARR is an after-tax 12%. Determine which alternative is less costly, based upon comparison of after-tax annual worth. Show the AW values used to make your decision: Alternative 1: $ Alternative 2: S Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is ±3%.
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![A portable concrete test instrument used in construction for evaluating and profiling concrete surfaces (MACRS-GDS 5-year property class) is under consideration by a construction firm for $26,000. The instrument will be used for 6 years and be
worth $2,250 at that time. The annual cost of use and maintenance will be $6,500. Alternatively, a more automated instrument (same property class) available from the manufacturer costs $29,500, with use and maintenance costs of only $7,500
and salvage value after 6 years of $3,000. The marginal tax rate is 40%, and MARR is an after-tax 12%.
Determine which alternative is less costly, based upon comparison of after-tax annual worth.
Show the AW values used to make your decision:
Alternative 1: $
Alternative 2: $
•
Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is ±3%.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc7fe5a73-45e4-4166-8ba1-50e355550dfc%2Fe605a0ca-fe7c-4db5-9fed-4f1aa069c8cb%2F4ecrka_processed.png&w=3840&q=75)
Transcribed Image Text:A portable concrete test instrument used in construction for evaluating and profiling concrete surfaces (MACRS-GDS 5-year property class) is under consideration by a construction firm for $26,000. The instrument will be used for 6 years and be
worth $2,250 at that time. The annual cost of use and maintenance will be $6,500. Alternatively, a more automated instrument (same property class) available from the manufacturer costs $29,500, with use and maintenance costs of only $7,500
and salvage value after 6 years of $3,000. The marginal tax rate is 40%, and MARR is an after-tax 12%.
Determine which alternative is less costly, based upon comparison of after-tax annual worth.
Show the AW values used to make your decision:
Alternative 1: $
Alternative 2: $
•
Carry all interim calculations to 5 decimal places and then round your final answer to the nearest dollar. The tolerance is ±3%.
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