Determine the required savings

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Reference no: EM131092001

A company invested in a pick and place robot for $675,000. The installation costs incurred were $175,000. The company obtained a loan to finance 60% of the equipment to be paid in six equal principal payments plus interest every year at 8%. The material handling equipment has a MACRS-GDS 5-year property class. The pick and place robot will generate savings on labor equivalent to $Y. The O&M costs will be a gradient series of $120,000. Perform an ATCF analysis to determine the required savings such that the company target MARJR. of 8% &g, achieved and a tax rate of 40%. The planning horizon is 6 years.

Reference no: EM131092001

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