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|Quick Clean $78,000 Mess Away First cost $65,000 0,000 Annual savings 24,000 347 Annual operating 4,000 |2,750 costs Scheduled maintenance $1500 at the end of 3rd $3000 at the end of 3rd |уear lyear Annual insurance* 2,000 2,200 Salvage value Useful life 10% of first cost 12.5% of first cost 5 years 5 years

|Quick Clean $78,000 Mess Away First cost $65,000 0,000 Annual savings 24,000 347 Annual operating 4,000 |2,750 costs Scheduled maintenance $1500 at the end of 3rd $3000 at the end of 3rd |уear lyear Annual insurance* 2,000 2,200 Salvage value Useful life 10% of first cost 12.5% of first cost 5 years 5 years

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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McClain, Edwards, Shiver, and Smith (MESS) LLC is considering the purchase of new automated cleaning equipment. The industrial engineer for the company has been asked to calculate the present worth of the two best alternatives based on the following data.
Determine which equipment should be purchased, given an interest rate of 8%

|Quick Clean $78,000 Mess Away First cost $65,000 0,000 Annual savings 24,000 347
Transcribed Image Text:|Quick Clean $78,000 Mess Away First cost $65,000 0,000 Annual savings 24,000 347
Annual operating 4,000 |2,750 costs Scheduled maintenance $1500 at the end of 3rd $3000 at the end of 3rd |уear lyear Annual insurance* 2,000 2,200 Salvage value Useful life 10% of first cost 12.5% of first cost 5 years 5 years
Transcribed Image Text:Annual operating 4,000 |2,750 costs Scheduled maintenance $1500 at the end of 3rd $3000 at the end of 3rd |уear lyear Annual insurance* 2,000 2,200 Salvage value Useful life 10% of first cost 12.5% of first cost 5 years 5 years
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