Question : i have project for economic

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26 Molehill & Mountain Mover

Initial Data: Conveyor; Straight Line Depreciation; Without Inflation Conveyor; Sum of Years Digits; Without Inflation Conveyor; Declining Balance; Without Inflation Conveyor; MACRS; Without Inflation
Conveyor Front-end Loader Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF
$250,000 $110,000 First Cost 40% TAX rate 0 -250000 -250000 0 -250000 -250000 0 -250000 -250000 0 -250000 -250000
$80,000 $30,000 Salvage Value 6% i 1 -32000 1 -32000 1 -32000 1 -32000
$32,000 $45,000 O&M 5 Recovery period (years) 2 -32000 2 -32000 2 -32000 2 -32000
15 15 Life 200% Factor for DB & MACRS 3 -32000 3 -32000 3 -32000 3 -32000
10% INFLation 4 -32000 4 -32000 4 -32000 4 -32000
Summary Table Details (J1:AN92) print as pages 3-10 5 -32000 5 -32000 5 -32000 5 -32000
Inflation Conveyor Front-end Loader Depreciation Method 6 -32000 6 -32000 6 -32000 6 -32000
w/o Inflation Straight Line 7 -32000 7 -32000 7 -32000 7 -32000
w/ Inflation Straight Line 8 -32000 8 -32000 8 -32000 8 -32000
w/o Inflation SOYD 9 -32000 9 -32000 9 -32000 9 -32000
w/ Inflation SOYD 10 -32000 10 -32000 10 -32000 10 -32000
w/o Inflation Declining Balance 11 -32000 11 -32000 11 -32000 11 -32000
w/ Inflation Declining Balance 12 -32000 12 -32000 12 -32000 12 -32000
w/o Inflation MACRS 13 -32000 13 -32000 13 -32000 13 -32000
w/ Inflation MACRS 14 -32000 14 -32000 14 -32000 14 -32000
15 80000 -32000 15 80000 -32000 15 80000 -32000 15 80000 -32000
Question a: without considering inflation, which system should be purchased and which depreciation method should be selected?
Annualized Cost Annualized Cost Annualized Cost Annualized Cost
Answer to a:
Question b: with inflation, is the conclusion still the same as above? Explain briefly.
Answer to b:
Conveyor; Straight Line Depreciation; With Inflation Conveyor; Sum of Years Digits; With Inflation Conveyor; Declining Balance; With Inflation Conveyor; MACRS; With Inflation
Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF
0 -250000 -250000 0 -250000 -250000 0 -250000 -250000 0 -250000 -250000
1 1 1 1
2 2 2 2
3 3 3 3
4 4 4 4
5 5 5 5
6 6 6 6
7 7 7 7
8 8 8 8
9 9 9 9
10 10 10 10
11 11 11 11
12 12 12 12
13 13 13 13
14 14 14 14
15 334180 15 334180 15 334180 15 334180
Annualized Cost Annualized Cost Annualized Cost Annualized Cost
Front End Loader; Straight Line Depreciation; Without Inflation Front End Loader; Sum of Years Digits; Without Inflation Front End Loader; Declining Balance; Without Inflation Front End Loader; MACRS; Without Inflation
Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF
0 -110000 -110000 0 -110000 -110000 0 -110000 -110000 0 -110000 -110000
1 -45000 1 -45000 1 -45000 1 -45000
2 -45000 2 -45000 2 -45000 2 -45000
3 -45000 3 -45000 3 -45000 3 -45000
4 -45000 4 -45000 4 -45000 4 -45000
5 -45000 5 -45000 5 -45000 5 -45000
6 -45000 6 -45000 6 -45000 6 -45000
7 -45000 7 -45000 7 -45000 7 -45000
8 -45000 8 -45000 8 -45000 8 -45000
9 -45000 9 -45000 9 -45000 9 -45000
10 -45000 10 -45000 10 -45000 10 -45000
11 -45000 11 -45000 11 -45000 11 -45000
12 -45000 12 -45000 12 -45000 12 -45000
13 -45000 13 -45000 13 -45000 13 -45000
14 -45000 14 -45000 14 -45000 14 -45000
15 30000 -45000 15 30000 -45000 15 30000 -45000 15 30000 -45000
Annualized Cost Annualized Cost Annualized Cost Annualized Cost
Front End Loader; Straight Line Depreciation; With Inflation Front End Loader; Sum of Years Digits; With Inflation Front End Loader; Declining Balance; With Inflation Front End Loader; MACRS; With Inflation
Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF Years Capital Cash Flows BTCF Dt Taxable Income Taxes ATCF
0 -110000 -110000 0 -110000 -110000 0 -110000 -110000 0 -110000 -110000
1 1 1 1
2 2 2 2
3 3 3 3
4 4 4 4
5 5 5 5
6 6 6 6
7 7 7 7
8 8 8 8
9 9 9 9
10 10 10 10
11 11 11 11
12 12 12 12
13 13 13 13
14 14 14 14
15 125317 15 125317 15 125317 15 125317
Annualized Cost Annualized Cost Annualized Cost Annualized Cost

&"Arial,Italic"Cases in Engineering Economy 2&Xnd&"Arial,Regular" &Xby Peterson && Eschenbach Case &A &P