DCF analysis - Comparing two machines (possibly replacing one):
Machine 1:
3 years old
original cost 800,000 (3 years ago)
Straight line depreciation
15 year life
zero salvage value
Machine 2:
cost 900,000
pre-tax labor savings of 100K per year
save $2000 in space per year
Can cell Machine 1 at $400,000 immediately
12 year life
Straight line depreciation
10% discount rate
35% tax rate
Please show excel spreadsheet work.
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