Should the company proceed with the process change

Reference no: EM13542298

The company Eco-Safe is adding pollution control equipment to its process and reducing emission of pollutants. The annual waste disposal cost of the current process is $130,000 and the annual operating cost is $600,000. The annual waste disposal cost of the new process is $70,000 and the waste disposal cost is $400,000. The cost of changing the existing process to the new process is $350,000. Should the company proceed with the process change? Make your calculations on present worth basis and use 8 percent discount rate and five year life.

Reference no: EM13542298

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