The purchasing price of the second-hand bulldozer is $100,000. It will have 8 years service life with a $5,000 salvage value. The operating cost is expected to be $4,500 in the first year, and it is estimated that the operating cost will be increasing by 10% per year thereafter. Determine the annual cost of the bulldozer at 3% per year.
The purchasing price of the second-hand bulldozer is $100,000. It will have 8 years service life with a $5,000 salvage value. The operating cost is expected to be $4,500 in the first year, and it is estimated that the operating cost will be increasing by 10% per year thereafter. Determine the annual cost of the bulldozer at 3% per year.
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:The purchasing price of the second-hand bulldozer is $100,000. It will have 8 years
service life with a $5,000 salvage value. The operating cost is expected to be $4,500
in the first year, and it is estimated that the operating cost will be increasing by 10%
per year thereafter. Determine the annual cost of the bulldozer at 3% per year.
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