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What amount of replacement reserves

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Reference no: EM131911132

You have projected your depreciation expense to be $1,000,000 in the next fiscal year with year-end accumulated depreciation balances being $5,000,000. If inflation in medical equipment is averaging 10% per year and you wish to finance only 20% of your replacement needs with debt, what amount of replacement reserves should you target for year-end?

Reference no: EM131911132

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