Alternative X has a first cost of 36000 an annual operating cost of 6900 , and a salvage value of 11025 after 13 year. Alternative Y has a first cost of 37000 an annual operating cost of 7000 , and a salvage value of 16280 after 13 year. If MARR of 13% per year, approximately what is the PW of each alternative?

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter11: Capital Budgeting Decisions
Section: Chapter Questions
Problem 17EA: Gardner Denver Company is considering the purchase of a new piece of factory equipment that will...
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Alternative X has a first cost of 36000 an
annual operating cost of 6900, and a
salvage value of 11025 after 13 year.
Alternative Y has a first cost of 37000 an
annual operating cost of 7000, and a
salvage value of 16280 after 13 year. If
MARR of 13% per year, approximately what
is the PW of each alternative?
Select one:
O a. PW of X= -77518 and PW of Y=
-78067
O b. PW of X= -75990 and PW of Y=
-76529
O c. PW of X= -76750 and PW of Y=
-77294
O d. PW of X= -78293 and PW of Y=
-78848
Transcribed Image Text:Alternative X has a first cost of 36000 an annual operating cost of 6900, and a salvage value of 11025 after 13 year. Alternative Y has a first cost of 37000 an annual operating cost of 7000, and a salvage value of 16280 after 13 year. If MARR of 13% per year, approximately what is the PW of each alternative? Select one: O a. PW of X= -77518 and PW of Y= -78067 O b. PW of X= -75990 and PW of Y= -76529 O c. PW of X= -76750 and PW of Y= -77294 O d. PW of X= -78293 and PW of Y= -78848
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