Q.2- if the rate of return is 10 % and all equipment shown in the following tablehave service life for 20 years with no salvage value, which equipment should beselected using the incremental benefit cost analysis.EquipmentFirst cost,SY1600000 1500000 1900000 1200000Annnal M&O, S/year 500006000035000so000Benefits, S'yearDis benefits, S/year26900026000028200025000013000150002200020000Life, years20202020

The cost-benefit analysis is an important method of capital budgeting. It refers to the ratio…

Q.2- if the rate of return is 10 % and all equipment shown in the following table have service life for 20 years with no salvage value, which equipment should be selected using the incremental benefit cost analysis. Equipment Y First cost,S 1600000 1500000 1900000 1200000 Annnal M&O, S/year 50000 60000 35000 so000 Benefits, S/year 269000 260000 282000 250000 Dis benefits, S/year 13000 15000 22000 20000 Life, years 20 20 20 20

Q.2- if the rate of return is 10 % and all equipment shown in the following table have service life for 20 years with no salvage value, which equipment should be selected using the incremental benefit cost analysis. Equipment Y First cost,S 1600000 1500000 1900000 1200000 Annnal M&O, S/year 50000 60000 35000 so000 Benefits, S/year 269000 260000 282000 250000 Dis benefits, S/year 13000 15000 22000 20000 Life, years 20 20 20 20

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter12: Capital Investment Analysis

Section: Chapter Questions

Problem 7E

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