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  3. (a) doraemon sdn. bhd. just purchased an automatic

(a) Doraemon Sdn. Bhd. just purchased an automatic printing machine for RM 10000 now with...

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Accounting

image (a) Doraemon Sdn. Bhd. just purchased an automatic printing machine for RM 10000 now with the annual payments of RM 500 per year for eight years from now. The maintenance cost increases by RM 20 per year beginning 5 years from now. The company plans to inject RM 2000 three and half years from now to increase the printing capacity. Determine the total present worth in year 0 of the cost if the interest rate is 8% per year with the assistance of the cash flow diagram. (10) Marks) (b) Lee and Partners Sdn. Bhd. plans to purchase a new machine to start a manufacturing plant. Two manufacturers offered the estimates below: Table 1: Cash flows summary of the investments i. Determine which supplier should be selected based on a present worth comparison if the MARR is 15% per year. (5 Marks) ii. If Lee and Partners Sdn. Bhd. has a standard practice of evaluating all options over a 5year period. Which vendor should be selected? Assume the salvage values are not expected to change. (10 Marks)

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