Spreadsheet with graph indicating capital recovery

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Reference no: EM132020638

A piece of onboard equipment has a first cost of $600,000, an annual cost of $92,000, and a salvage value that decreases to zero by $150,000 each year of the equipment’s maximum useful life of 5 years.

Assume the company’s MARR is 10% per year.

(a) Determine the ESL by hand.

(b) Use a spreadsheet with a graph indicating the capital recovery, AOC, and total AW per year to determine the ESL.

Aw is average worth

AOC-annual opperating costs

ESL-economic service life

Reference no: EM132020638

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