Contemporary Engineering Economics 6th Edition by Chan Park

Exercise 23

The Emerson Electronics Company just purchased a soldering machine to be used in its assembly cell for flexible disk drives. The soldering machine cost $350,000. Because of the specialized function it performs, its useful life is estimated to be five years. It is also estimated that at that time its salvage value will be $60,000. What is the capital recovery cost for this investment if the firm's interest rate is 15%