Answer Happy

Problem 3: You are looking to calculate the EUAW from the financial information provided in the table below for a new equipment. Because of the uncertainty of technology being used in this equipment, it has not been possible to get the initial cost accurately, so you are using accost given below. The annual benefit, however, is estimated to be $25,000 with a possible equipment life of 5 years. The salvage value is expected to be 10% of the initial cost. MARR=8% First Cost, $ Probability $60,000 $80,000 0.25 0.35 $100,000 $120,000 0.30 0.10 Chapter 11 Problem 4: American Corporation Truck Production Company has purchased a truck for $85,000. The estimate useful life is 5 years with a salvage value of $10,000. Compute the depreciation schedule using the following 4 methods and briefly discuss, which one is better and why? a. 100% bonus depreciation b. Straight line depreciation c. Double Declining Bonus depreciation d. MACRS depreciation