A company is going to buy a new machine for manufacturing its product. Four different machines are available.

Managerial Economics: Applications, Strategies and Tactics (MindTap Course List)
14th Edition
ISBN:9781305506381
Author:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Publisher:James R. McGuigan, R. Charles Moyer, Frederick H.deB. Harris
Chapter17: Long-term Investment Analysis
Section: Chapter Questions
Problem 10E
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Using annual cost method, what is the total annual cost of machine A, B, C, D.

A company is going to buy a new machine for manufacturing its product.
Four different machines are available.
First cost
Power per
year
Labor per
year
A
B
с
D
Php
Php Php
Php
24,000 30,000 49,600 52,000
Php Php Php Php
1,300 1,360 2,400 2,020
Php Php Php Php
11,600 9,320 4,200 2,000
Maintenance Php Php Php Php
per year
2,800 1,900
1,300
700
Taxes and
insurance
Life, years
Money is worth 17% before taxes to the company.
3% 3% 3% 3%
5
5
5
5
Transcribed Image Text:A company is going to buy a new machine for manufacturing its product. Four different machines are available. First cost Power per year Labor per year A B с D Php Php Php Php 24,000 30,000 49,600 52,000 Php Php Php Php 1,300 1,360 2,400 2,020 Php Php Php Php 11,600 9,320 4,200 2,000 Maintenance Php Php Php Php per year 2,800 1,900 1,300 700 Taxes and insurance Life, years Money is worth 17% before taxes to the company. 3% 3% 3% 3% 5 5 5 5
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