ACC 560 Week 8 Homework Chapter 12( E12-3, E12-5, E12-8)
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ACC 560 Week 8 Homework Chapter 12( E12-3, E12-5, E12-8)
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ACC 560 Week 8 Homework Chapter 12( E12-3, E12-5, E12-8) Chapter 12: Planning for Capital Investments E12-3
Hillsong Inc. manufactures snowsuits. Hillsong is considering purchasing a new sewing machine at a cost of $ 2.45 million. Its existing machine was purchased five years ago at a price of $ 1.8 million; six months ago, Hillsong spent $ 55,000 to keep it operational. The existing sewing machine can be sold today for $ 250,000. The new sewing machine would require a one-time, $ 85,000 training cost. Operating costs would decrease by the following amounts for years 1 to 7:
Year 1 $ 390,000 2 400,000 3 411,000 4 426,000 5 434,000 6 435,000