Parker Hannifin of Cleveland, Ohio manufactures CNG fuel dispensers. It needs replacement equipment to streamline one of its production lines for a new contract, but plans to sell the equipment at or before its expected life is reached at an estimated market value for used equipment. Select between the two options using the corporate MARR of 15% per year and a future worth analysis for the expected use period. Also, write the FV spreadsheet functions that will display the correct future worth values. Option D E First cost, $ −62,000 −77,000 AOC, $ per year −15,000 −21,000 Expected market value, $ 8,000 10,000 Expected use, years 3 6
Parker Hannifin of Cleveland, Ohio manufactures CNG fuel dispensers. It needs replacement equipment to streamline one of its production lines for a new contract, but plans to sell the equipment at or before its expected life is reached at an estimated market value for used equipment. Select between the two options using the corporate MARR of 15% per year and a future worth analysis for the expected use period. Also, write the FV spreadsheet functions that will display the correct future worth values. Option D E First cost, $ −62,000 −77,000 AOC, $ per year −15,000 −21,000 Expected market value, $ 8,000 10,000 Expected use, years 3 6
Excel Applications for Accounting Principles
4th Edition
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Gaylord N. Smith
Chapter26: Capital Budgeting (capbud)
Section: Chapter Questions
Problem 5R
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Question
Parker Hannifin of Cleveland, Ohio manufactures
CNG fuel dispensers. It needs replacement equipment
to streamline one of its production lines for a
new contract, but plans to sell the equipment at or
before its expected life is reached at an estimated
market value for used equipment. Select between
the two options using the corporate MARR of 15%
per year and a future worth analysis for the expected
use period. Also, write the FV spreadsheet
functions that will display the correct
values.
Option D E
First cost, $ −62,000 −77,000
AOC, $ per year −15,000 −21,000
Expected market value, $ 8,000 10,000
Expected use, years 3 6
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