Hagar industrial systems company hisc is trying to decide, Ask an Expert

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Hagar Industrial Systems Company (HISC) is trying to decide between two different conveyor belt systems. System A costs $264,000, has a four-year life, and requires $81,000 in pretax annual operating costs. System B costs $372,000, has a six-year life, and requires $75,000 in pretax annual operating costs. Both systems are to be depreciated straight-line to zero over their lives and will have zero salvage value. Whichever system is chosen, it will not be replaced when it wears out. The tax rate is 34 percent and the discount rate is 8 percent.

Calculate the NPV for both conveyor belt systems.

System A=

System B=

Can you give me some detail for the answer?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91546511

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