Alia wants to open up a sandwich shop in Amman. She collects data on the initial cost, operating and maintenance cost, yearly benefit (revenue from sandwich sales), and salvage value of the equipment she buys for the sandwich shop when she closes down the business in 5 years. Determine the best alternative using the annual cash flow analysis method for an interest rate of 8%. Do nothing is a possible alternative. Alt B $45,000 $25,000 $10,000 $4,000 $18,000 $13,000 $3,000 $6,000 Alt A First Cost Benefit per yr O&M annua st Salvage Value Life in years 5 (35 Points) Alt C $20,000 $1,900 $9,000 $4,600 Alt A $45,000 $10,000 and $18,000 Alt B $25,000 $4,000 $13,000 Alt C $20,000 $1.900 $9,000 First Cost Benefit per year Operations maintenance cost Salvage Value Life in years $3,000 $6.000 $4,600
Alia wants to open up a sandwich shop in Amman. She collects data on the initial cost, operating and maintenance cost, yearly benefit (revenue from sandwich sales), and salvage value of the equipment she buys for the sandwich shop when she closes down the business in 5 years. Determine the best alternative using the annual cash flow analysis method for an interest rate of 8%. Do nothing is a possible alternative. Alt B $45,000 $25,000 $10,000 $4,000 $18,000 $13,000 $3,000 $6,000 Alt A First Cost Benefit per yr O&M annua st Salvage Value Life in years 5 (35 Points) Alt C $20,000 $1,900 $9,000 $4,600 Alt A $45,000 $10,000 and $18,000 Alt B $25,000 $4,000 $13,000 Alt C $20,000 $1.900 $9,000 First Cost Benefit per year Operations maintenance cost Salvage Value Life in years $3,000 $6.000 $4,600
Chapter5: Managing Checking And Savings Accounts
Section: Chapter Questions
Problem 2FPC
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Transcribed Image Text:Alia wants to open up a sandwich shop in Amman. She collects data on the initial cost,
operating and maintenance cost, yearly benefit (revenue from sandwich sales), and salvage
value of the equipment she buys for the sandwich shop when she closes down the business in
5 years. Determine the best alternative using the annual cash flow analysis method for an
interest rate of 8%. Do nothing is a possible alternative.
Alt B
$45,000 $25,000
$10,000 $4,000
$18,000 $13,000
$3,000 $6,000
Alt A
First Cost
Benefit per yr
O&M annua st
Salvage Value
Life in years 5
(35 Points)
Alt C
$20,000
$1,900
$9,000
$4,600
Alt A
$45,000
$10,000
and $18,000
Alt B
$25,000
$4,000
$13,000
Alt C
$20,000
$1.900
$9,000
First Cost
Benefit per year
Operations
maintenance cost
Salvage Value
Life in years
$3,000
$6.000
$4,600
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