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Mr. Dubey • 100.69K Points
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Q. You just purchased a pin inserting machine to relieve some bottleneck problems that have been created in manufacturing a PC board. The machine cost $56,000 and has an estimated service life of 5 years. At that time, the estimated salvage value would be $5,000. The machine is expected to operate 2,500 hours per year. The expected annual operating and maintenance cost would be $6,000. If your firm’s interest rate is 15%, what would be the machine cost per hour?

  • (A) 8.79
  • (B) 7.85
  • (C) 11.85
  • (D) 5.89
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