Will wash manager of the laundry department at the hooty

Reference no: EM13583744

Will Wash,Manager of the Laundry Department at the Hooty Snooty Hotel is considering the purchase of a dryer which turns off automatically when laundry is dry. The new dryer will replace a dryer currently being used, which must be monitored to determine when laundry is dry. Selected information on the two machines is given below:

	Standard Dryer	Automatic Turn-off Dryer

Original cost new	$6,000	$8,000
Accumulated depreciation to date	2,400	-0-
Current salvage value	2,000	-0-
Estimated cost per year to operate	4,500	2,500
Remaining years of useful life	5 years	5 years

Required:

Show computation covering the five-year period that will show the net advantage or disadvantage of purchasing the automatic dryer. Ignore income taxes, and use only relevant costs in your analysis- be brief.

Reference no: EM13583744

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