CH.6 - 6.1...

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6.1 The estimate obtained from the three-year AW would not be valid, because the AW calculated over one life cycle is valid only for the entire cycle, not part of the cycle. Here the asset would be used for only a part of its three-year life cycle. 6.4 n NCF (Ce) Sal NCF (B) Sal 0  $(250,000.00)  $-     $(170,000.00)  $-    1  $(31,000.00)  $-     $(35,000.00)  $(26,000.00) 2  $(31,000.00)  $-     $(35,000.00)  $-    3  $(31,000.00)  $-     $(35,000.00)  $-    4  $(31,000.00)  $-     $(35,000.00)  $10,000.00  5  $(31,000.00)  $-     $(35,000.00) 6  $(31,000.00)  $40,000.00   $(35,000.00) PW(c) = Ac = -250000(A/P,10%,6) -31000 + 40000(A/F,10%,6) Ac =  $(83,218.10) Ab = -170000(A/P,10%,4) -35000 + 10000(A/F,10%,4)-26000(P/F,1 Ab =   $(93,253.51) 6.7 n NCF (X) Sal NCF (Y) Sal 0  $(85,000.00)  $-     $(97,000.00)  $-    1  $(30,000.00)  $-     $(27,000.00)  $-   
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This note was uploaded on 04/11/2010 for the course MST 502 taught by Professor Atals during the Spring '10 term at SUNY IT.

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CH.6 - 6.1...

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