A public utility is considering the following 3 mutually exclusive alternatives to supplying water for a small town: Alt A Alt B Alt C Initial cost $ 240,000 350,000 650,000 Maintenance $lyr 8,000 12,000 7,000 Sales $lyr 80,000 200,000 180,000 Life (yrs) 9 12 Infinite Determine the best alternative using the incremental benefit cost ratio method. The rate is 6% per year.

Cornerstones of Cost Management (Cornerstones Series)
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Author:Don R. Hansen, Maryanne M. Mowen
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Chapter19: Capital Investment
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A public utility is considering the following 3 mutually exclusive alternatives to supplying water for a small town:
Alt A
Alt B
Alt C
Initial cost $
240,000
350,000
650,000
Maintenance $lyr
8,000
12,000
7,000
Sales $lyr
80,000
200,000
180,000
Life (yrs)
12
Infinite
Determine the best alternative using the incremental benefit cost ratio method. The rate is 6% per year.
Transcribed Image Text:A public utility is considering the following 3 mutually exclusive alternatives to supplying water for a small town: Alt A Alt B Alt C Initial cost $ 240,000 350,000 650,000 Maintenance $lyr 8,000 12,000 7,000 Sales $lyr 80,000 200,000 180,000 Life (yrs) 12 Infinite Determine the best alternative using the incremental benefit cost ratio method. The rate is 6% per year.
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