A start up Business is considering two types of equipment A start up business is considering two types of equipment - data are as follows:I TYPE ATYPE BFirst CostP200,000.00P300,000.00Annual operating cost32,000.0024,000.00Annual labor cost50,000.0032,000.00Insurance and property taxes3%3%Payroll taxes4%4%Estimated life1010The minimum required rate of return is 15%.Using present worth cost method, determine the value of alternative A and alternative B:ANSWER for ALTERNATIVE A: Blank 1ANSWER for ALTERNATIVE B: Blank 2

The present worth analysis is an analysis in which all the future costs and the benefits related to…

Answered: A start up business iIS I TYPE A TYPE B…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter9: Capital Budgeting And Cash Flow Analysis

Section: Chapter Questions

Problem 19P

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A start up business iIS I TYPE A TYPE B First Cost P200,000.00 P300,000.00 Annual operating cost 32,000.00 24,000.00 Annual labor cost 50,000.00 32,000.00 Insurance and property taxes 3% 3% Payroll taxes 4% 4% Estimated life 10 10 The minimum required rate of return is 15%.