Question 4. Compare the use one of the electronic circuits, as shown in the table below, which electronic circuit is the best using Internal Rate of Return

Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter15: Capital Investment Analysis
Section: Chapter Questions
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Question 4. Compare the use one of the electronic circuits, as
shown in the table below, which electronic circuit is the
best using Internal Rate of Return
Start with i=17%
Circuit A
Device B
Initial cost
Initial cost
2900
1000
Annual revenues
Annual revenues
1000
OR/yr
O&M
O&M annual
O&M annual
180
maintenance
maintenance
Upgrade cost at the
1500
5th year
200
Salvage value
Salvage value
460
8
Useful live
Useful live
8
Transcribed Image Text:Question 4. Compare the use one of the electronic circuits, as shown in the table below, which electronic circuit is the best using Internal Rate of Return Start with i=17% Circuit A Device B Initial cost Initial cost 2900 1000 Annual revenues Annual revenues 1000 OR/yr O&M O&M annual O&M annual 180 maintenance maintenance Upgrade cost at the 1500 5th year 200 Salvage value Salvage value 460 8 Useful live Useful live 8
C
O&M
4400
270
Transcribed Image Text:C O&M 4400 270
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