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Business, 06.05.2021 17:30 Leilaniabma

A presently owned machine can last 3 more years if properly maintained at a cost of $14,000 per year. Its AOC is $27,000 per year. After 3 years, it can be sold for an estimated $9,000. A replacement costs $72,000 with a $10,000 salvage value after 3 years and an operating cost of $17,000 per year. Different vendors have offered $10,000 and $14,000, respectively, for the current system as a trade-in for the replacement machine. Required:
At 12% per year interest, perform a replacement study for the two trade-in offers.

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A presently owned machine can last 3 more years if properly maintained at a cost of $14,000 per year...

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