Required information The TT Racing and Performance Motor Corporation wish to evaluate two alternative machines for NASCAR motor tune- ups. Machine R S First cost, $ -290,000 -350,500 k Annual operating cost, $ per year -40,000 -50,000 Life, years 5 Salvage value, $ 21,900 16,000 t ht Use the AW method at 9% per year to select the better alternative. The annual worth of machine R is $- 67885, and the annual worth of machine S is $- 37437 ences The better alternative is machine S

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Required information
The TT Racing and Performance Motor Corporation wish to evaluate two alternative machines for NASCAR motor tune-
ups.
Machine
R
S
First cost, $
-290,000
-350,500
k
Annual operating cost, $ per year
-40,000
-50,000
Life, years
5
Salvage value, $
21,900
16,000
t
ht
Use the AW method at 9% per year to select the better alternative.
The annual worth of machine R is $-
67885, and the annual worth of machine S is $-
37437
ences
The better alternative is machine S
Transcribed Image Text:Required information The TT Racing and Performance Motor Corporation wish to evaluate two alternative machines for NASCAR motor tune- ups. Machine R S First cost, $ -290,000 -350,500 k Annual operating cost, $ per year -40,000 -50,000 Life, years 5 Salvage value, $ 21,900 16,000 t ht Use the AW method at 9% per year to select the better alternative. The annual worth of machine R is $- 67885, and the annual worth of machine S is $- 37437 ences The better alternative is machine S
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