Problem 2: A company is considering the purchase of a generating set to supply the electrical needs of his office during brownouts. The generating set costs P 70,000 with a life of 10 years with a salvage value of P 10,000. The daily operating cost is P 50 per hour. During a brownout, the office operation will be delayed which cause a loss of P 150 per hour. At 18% interest rate, how frequent( in number of hours per year ) is the brownout to justify the purchase of the generator set?
Problem 2: A company is considering the purchase of a generating set to supply the electrical needs of his office during brownouts. The generating set costs P 70,000 with a life of 10 years with a salvage value of P 10,000. The daily operating cost is P 50 per hour. During a brownout, the office operation will be delayed which cause a loss of P 150 per hour. At 18% interest rate, how frequent( in number of hours per year ) is the brownout to justify the purchase of the generator set?
Fundamentals of Financial Management, Concise Edition (MindTap Course List)
9th Edition
ISBN:9781305635937
Author:Eugene F. Brigham, Joel F. Houston
Publisher:Eugene F. Brigham, Joel F. Houston
Chapter12: Cash Flow Estimation And Risk Analysis
Section: Chapter Questions
Problem 11P: REPLACEMENT ANALYSIS St. Johns River Shipyards is considering the replacement of an 8-year-old...
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