Estimated annual cost, Using MACRS depreciation, a tax rate

Estimated annual cost

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New Tech is in need of new jigs for some assembly equipment. The jigs favored by the manufacturing engineer cost $30,000 and are expected to provide service for 6 years. The annual operating costs are estimated to be $2000. The industrial engineer favors a choice that costs $35,000 and that will also provide service for 6 years at an estimated annual cost of $1500. Using MACRS depreciation, a tax rate of 34%, and a MARR of 10%, which jigs should be chosen?

Reference no: EM131810162

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