ABC Beverage, LLC purchases its 355-ml cans in large bulk from Wald-China Can Corporation. The finish on the anodized aluminum surface is produced by mechanical finishing technologies called brushing or bead blasting. Engineers at Wald are switching to more efficient, faster, and cheaper machines to supply ABC. Use the estimates and MARR = 8% per year to select between the two alternatives. Brush alternative: P = $−400,000; n = 10 years; S = $50,000; nonlabor AOC = $−60,000 in year 1, decreasing by $5000 annually starting in year 2 Bead blasting alternative: P = $−400,000; n is large, assume permanent; no salvage; nonlabor AOC = $−70,000 per year

Morton and Moore LLC (M²) is trying to decide between two machines that are necessary in its manufacturing facility. If M² has a MARR of 10%, which of the following machines should be chosen? Hint: Minimize EUAC. Machine A Machine B 6- 28 620 First cost $45,000 $24,000 Annual operating costs 31,000 35,000 Overhaul in Years 2 and 4 6,000 Overhaul in Year 5 12,000 Salvage value 10,000 8,000 Useful life 8 years 6 years 1 Ne Ac Ca Ca EM Ye Co Pr Ri Vi Ge Lit Ra Ne An Pr Sa Sc Be

Vista Company manufactures electronic equipment. It currently purchases the special switches used in each of its products from an outside supplier. The supplier charges Vista $5.50 per switch. Vista's CEO is considering purchasing either machine A or machine B so the company can manufacture its own switches. The projected data are as follows: Annual fixed costs Variable cost per switch Machine A $632,400 1.78 Required: 1. For each machine, what is the minimum number of switches that Vista must make annually for total costs to equal outside purchase cost? 2. What volume level would produce the same total costs regardless of the machine purchased? 3. What is the most profitable alternative for producing 235,000 switches per year and what is the total cost of that alternative? Required 1 Required 2 Required 3 Complete this question by entering your answers in the tabs below. Machine B $ 860,100 0.80 Minimum number of switches For each machine, what is the minimum number of switches that…

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