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For each problem, solve the analysis with the provided equations in Table 4-3 as well as using the

tabulated factors in Appendix 4-1.

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1. A brewing company is deciding between two temporary filling machines, needed for 3 yrs. The Kram Filler with an initial cost of $65,000 and the Zanni Filler with an initial cost of $52,000. Both have anticipated annual maintenance costs of $7,000. The Kram however is expected to save $3,500 a year in energy costs and have a salvage value of $20,000. The Zanni has little to no salvage value. Assuming a MARR of 10% which machine should be purchased. 2. The chemistry department purchased centrifuges for $20,000. If the device is treated as 7-year property, create the depreciation schedule for this equipment. 3. The Smith Company uses a 10 hp motor 16 hours per day, 5 days per week, 50 weeks per year in its flexible work cell. This motor is 85% efficient, and it is near the end of its useful life. The company is considering buying a new high efficiency motor (91% efficient) to replace the old one instead of buying a standard efficiency motor (86.4% efficient). The high efficiency motor costs $70 more than the standard model, and should have a 15 year life. The company pays $7.00/kW per month and $0.06/kWh. The company has set a discount rate of 10% for their use in comparing projects. Determine the SPP, ROI and BCR for this project. The company's discount rate is 10%

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