company purchased an equipment for P8,000,000. Freight and installation charges amounted to 4.5% of the purchase price. If the equipment shall be depreciated over a period of 8 years with a salvage value of 7%, determine the following: (a.) Annual depreciation charge using the straight line method (b.) Depreciation during the fifth year using the sum-of-the-years-digit method.  Kindly answer this Engineering economy problem and show its cash flow diagram. thank you.

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Pricing Construction Equipment

Pricing construction equipment means estimating the cost of operation of all the construction equipment used in a construction project. The pricing is done based on two factors – ownership cost and operating cost of the equipment. Thorough knowledge of the ownership and operating costs is necessary for proper project management and executing profitable construction.