Henry has an assignment from his boss at Czech Glass and Wood Sculpting to evaluate depreciation methods for writing off the $240,000 first cost of a newly acquired Trotec CO2 laser system for engraving and cutting. Productive life is 8 years and salvage is estimated at $10,000. Henry wants to compare the PW of depreciation at i = 13% per year for DDB-to-SL switching with MACRS for n = 7 years to determine which is the preferred method. 1.The present worth of DDB-to-SL depreciation values is $ 2.The present worth of MACRS depreciation values is $ The MACRS method is preferred.
Henry has an assignment from his boss at Czech Glass and Wood Sculpting to evaluate depreciation methods for writing off the $240,000 first cost of a newly acquired Trotec CO2 laser system for engraving and cutting. Productive life is 8 years and salvage is estimated at $10,000. Henry wants to compare the PW of depreciation at i = 13% per year for DDB-to-SL switching with MACRS for n = 7 years to determine which is the preferred method. 1.The present worth of DDB-to-SL depreciation values is $ 2.The present worth of MACRS depreciation values is $ The MACRS method is preferred.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Henry has an assignment from his boss at Czech Glass and Wood Sculpting to evaluate depreciation methods for writing off the $240,000 first cost of a newly acquired Trotec CO2 laser system for engraving and cutting. Productive life is 8 years and salvage is estimated at $10,000. Henry wants to compare the PW of depreciation at i = 13% per year for DDB-to-SL switching with MACRS for n = 7 years to determine which is the preferred method.
1.The present worth of DDB-to-SL depreciation values is $
2.The present worth of MACRS depreciation values is $
The MACRS method is preferred.
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