Dr. P is considering buying a new Geo-Probe to begin doing subsurface investigation. Two different m

 
   

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Dr. P is considering buying a new Geo-Probe to begin doing subsurface investigation. Two different models are available on the market, his MARR is 10%. a. Assuming sum-of-years digits depreciation, what book value will Model – I have after two years? b. Assuming double declining balance depreciation, what book value will Model – ll have after three years? c. What salvage value (5) must Model – I have after 20 years in order for the equivalent uniform annual cost to equal $26,500? Data 20 25 Model- I Model – II Remark Useful Life , Years First Cost, $ 80,000 $100,000 Salvage Value, $ 20,000 25,000 Annual Operating Costs, 15,000 Years 1 through 10, 20,000 years 11 through 25.