Mamma Mia's Pizza must replace its current pizza-baking oven. The two best alternatives are Crispy Cruster and Easy Baker. Assume an income tax rate of 50% and MARR after-taxes of 10% per year. Which pizza-baking oven would you select and why? State any important assumptions you make in your analysis.
|
Crispy Cruster
|
Easy Baker
|
Initial Cost
|
$24000
|
$33000
|
Annual Costs
|
$9000
|
$6000
|
Salvage Value
|
$6000
|
$5000
|
Useful Life
|
3 years
|
4 years
|
Depreciation Method
|
SL
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150% DB
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