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Business, 25.10.2019 20:43 brummy309506

Precision tool is analyzing two machines to determine which one it should purchase. the company requires a 15 percent rate of return and uses straight-line depreciation to a zero book value over the life of its equipment. machine a has a cost $892,000, annual operating costs of $26,300, and a 4 year life. machine b costs $1,127,000, has annual operating costs of $19,500, and has a 5 year life. whichever machine is purchased will be replaced at the end of its useful life. precision tool should purchase machine because it lowers the firm's annual cost by approximately as compared to the other machinea. a: $16,965b. a: $17,404c. b: $16,965d. b: $17,404e. b: $17,521

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