Considering the purchase of earth-moving equipment

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Reference no: EM131552644

A land development company is considering the purchase of earth-moving equipment. The equipment will have a first cost of S190,000 and a salvage value of ST0000 when the company sells it in 10 years. A service contract for maintenance on the equipment will cost S40000 per year. The operating cost is expected to be s260 per day. Alternatively, the company can rent the necessary equipment for si 100 per day and hire a driver at S180 per day, lf the company's order MARR is 10% per year, how many days per year must the company need the equipment m to justify its purchase?

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Reference no: EM131552644

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