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A Diesel power plant located in Subic, Pampanga, is wanting to acquire a new generator set for the plant to replace the unit that they currently use. The new set has an amount of P150,000 which can last up to 5 years and no salvage value. It has production cost of P175,000. The present generator set they have still has a life of 5 remaining years out of the 10 years of its useful life with a salvage value of P12,000. Its current value can be computed by Straight Line Method. Its original cost is P130,000 that has a production cost of P180,000. If money is worth 10%, what would you suggest

A Diesel power plant located in Subic, Pampanga, is wanting to acquire a new generator set for the plant to replace the unit that they currently use. The new set has an amount of P150,000 which can last up to 5 years and no salvage value. It has production cost of P175,000. The present generator set they have still has a life of 5 remaining years out of the 10 years of its useful life with a salvage value of P12,000. Its current value can be computed by Straight Line Method. Its original cost is P130,000 that has a production cost of P180,000. If money is worth 10%, what would you suggest

EBK CONTEMPORARY FINANCIAL MANAGEMENT
EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN:9781337514835
Author:MOYER
Publisher:MOYER
Chapter9: Capital Budgeting And Cash Flow Analysis
Section: Chapter Questions
Problem 10P
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A Diesel power plant located in Subic, Pampanga, is wanting to acquire a new generator set for the plant to replace the unit that they currently use. The new set has an amount of P150,000 which can last up to 5 years and no salvage value. It has production cost of P175,000. The present generator set they have still has a life of 5 remaining years out of the 10 years of its useful life with a salvage value of P12,000. Its current value can be computed by Straight Line Method. Its original cost is P130,000 that has a production cost of P180,000. If money is worth 10%, what would you suggest?

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