Calculate eac for both models and choose which one you buy

Assignment Help Financial Accounting
Reference no: EM131712453

You are starting a family pizza parlor and need to buy a motorcycle for delivery orders.

You have two models in mind. Model A costs $9,200 and is expected to run for 7 years; model B is more expensive, with a price of $15,200 and has an expected life of 10 years. The annual maintenance costs are $810 for model A and $710 for model

B. Assume that the opportunity cost of capital is 12 percent. Calculate EAC for both the models and choose which one should you buy? (Round intermediate calculations and final answers to 2 decimal places, e.g. 15.25.)

Reference no: EM131712453

Questions Cloud

What is the lowest possible per shovel price : This investment will be recovered at the end of the third year. Merton Shovel has a 35 percent marginal tax rate and a 15 percent required rate of return
Estimate the median winning speed : Derby speeds 2007. How fast do horses run? Kentucky Derby winners top 30 miles per hour, as shown in this graph. The graph shows the percentage of Derby.
Matches the correct nmr spectrum : Draw the products below and place them in the box that matches the correct NMR spectrum. Circle which product would be favored.
How far do you think the ball would have traveled : Galileo's Falling Bodies - If the ramp shown in the video had been longer: How far do you think the ball would have traveled after 4 seconds
Calculate eac for both models and choose which one you buy : Assume that the opportunity cost of capital is 12 percent. Calculate EAC for both the models and choose which one should you buy?
Why you should define your fears : What did you think about this exercise and approaching goal orientation from a different direction? Did you prefer the WOOP model from last week?
Thermochemical equation that you created in question : Imagine that a space mission is using ethane for a fuel. How much oxygen will the crew be required to bring along if the energy requirements
Write a few sentences describing the distribution : Cholesterol. The Framingham Heart Study recorded the cholesterol levels of more than 1400 men. Here is an ogive of the distribution of these cholesterol.
How many moles of photons is that : How many moles of photons is that? Density of water = 0.998 g/mL, water's heat capacity = 4.184 J/g*°C

Reviews

Write a Review

Financial Accounting Questions & Answers

  What is the interest rate associated with the loan

If you borrow a princcipal amount of $5000 and are required to repay the loan in five equal installments of 1800, what is the interest rate associated with the loan?

  Find the total cost of serving

The activity-based costing system and find the total cost of serving each of the following parties of diners? a. A party of four diners who three drinks in total.

  Payments are semiannually with the first payment

A $10,000 bond, due in 20 years has a 5% interest rate. Payments are semiannually with the first payment 6 months from now. What should the price of the bond be to have a yield of nominal 7% compounded semiannually?

  Why might pepsico have a higher cost of sales than coca-cola

Why might PepsiCo have a higher cost of sales than Coca-Cola? What are the likely reasons PepsiCo's inventory turnover ratio exceeds that for Coca- Cola?

  How did the bankruptcy risk of circuit city change

How did the bankruptcy risk of Best Buy change between 2007 and 2008? Explain. How did the bankruptcy risk of Circuit City change between 2007 and 2008? Explain.

  Prepare a separate journal entry to record the disposition

In order to provide capital for new hotel construction in other locations, Prepare a separate journal entry to record the disposition of each of these assets.

  Determining market risk premium

What is the market risk premium if the risk free rate is 5% and the expected market return is given as follows

  Illustrate by what amount will fink paid in capital

Mitchell's usual billing rate is $720 per hour, and Fink's stock has a book value of $340 per share. Illustrate by what amount will Fink's Paid-in capital – excess of par increase for this transaction?

  What is amount and character of any income-gain recognized

Aggie Corporation made a distribution of $547,000 to Rusty Cedar in partial liquidation of the company on December 31 of this year. Rusty, an individual, owns 100 percent of Aggie Corporation. What is the amount and character (capital gain or dividen..

  Prepare the journal entry that faulkner can record

Prepare the journal entry that Faulkner may record in 2013 related to the change. (If no entry is needed for a particular event, select "No journal entry required" in the first account field.)

  Adjustment in general account balances

Adjustment in general account balances - Olsen Company has two office employees who earn $80 and $100 per day, respectively. They are paid each Friday for a five-day work week that begins each Monday. June 30 is a Tuesday in 2009.

  What gain and net reduction in retained earnings

Mildred Corporation owned 2,000 shares of Lester Corporation. These shares were purchased in 2010 for $18,000. On October 15, 2014, Mildred declared a property dividend of one share of Lester for every ten shares of Mildred held by a stockholder. On ..

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd