Maxx International is considering one of two forklifts trucks for its assembly plant. Truck A costs $15,000 and requires $3,000 monthly in operating expenses. It will have a salvage value of $5,000 at the end of its three-year service life. Tuck B costs $20,000 but requires only $2,000 annually in operating expenses; its service life is 4 years; at which time, its expected salvage value will be $8,000. The MARR is 10%. Assuming that the trucks are needed for 12 years and that no significant changes are expected in the future price and functional capacity each truck, select the most economical truck based on AE analysis. Fill in the blanks: Costs of ownership for truck A Operating costs for truck A ........................................ Total annual costs for truck A ....................
Maxx International is considering one of two forklifts trucks for its assembly plant. Truck A costs $15,000 and requires $3,000 monthly in operating expenses. It will have a salvage value of $5,000 at the end of its three-year service life. Tuck B costs $20,000 but requires only $2,000 annually in operating expenses; its service life is 4 years; at which time, its expected salvage value will be $8,000. The MARR is 10%. Assuming that the trucks are needed for 12 years and that no significant changes are expected in the future price and functional capacity each truck, select the most economical truck based on AE analysis.
Fill in the blanks:
Costs of ownership for truck A
Operating costs for truck A ........................................
Total annual costs for truck A ....................
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