1. An existing machine is bought three years ago for Php. 100,000 we a remaining useful life of 8 years. The annual oper
Posted: Thu Apr 28, 2022 3:28 pm
1. An existing machine is bought three years ago for Php. 100,000 we a remaining useful life of 8 years. The annual operating cost of the machine is Php. 23,000 with a salvage value of Php. 8,000 after 8 years. The machine can be sold for Php. 80,000. A more efficient machine cost Php. 160,000 with an operating cost of Php. 10,000. The vendor offered a trade-in value of Php. 85,000. The more efficient machine has 8 years useful life with no salvage value at the end of its life. Should you keep the existing machine or buy a new one? MARR = 10%