Problem on the hazardous environment facilities

Reference no: EM131806457

Qusetion: Two hazardous environment facilities are being evaluated, with the projected life of each facility being 10 years. The cash flows are as follows:

	Alt. A	Alt. B
First cost	$615,000	$300,000
Maintenance and operating cost	10,000	25,000
Annual benefits	158,000	92,000
Salvage value	65,000	-5,000

The company uses a MARR of 15%. Using rate of return analysis, which alternative should be selected?

Reference no: EM131806457

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