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A precision lathe costs 10000 and will cost 20000 a year to operate and maintain if the discount rate is 10 percent and the lathe will last 5 years what is the equivalent annual cost of the tool?
Wiki User
∙ 12y ago
Machine cost: 10000
Cost per year to operate with client discount (on our account): 20000 + 10% = 22000
Cost to operate over 5 years: 22000 x 5 = 110000
Machine cost + Cost to operate over 5 years: 110000 + 10000 = 120000
Annual cost per year: 120000 \ 5 = 24000
Wiki User
∙ 12y ago
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