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Business, 17.12.2019 05:31 qdogisbeast7662

Assume that united technologies corporation is evaluating a proposal to change the company's manual design system to a computer-aided design (cad) system. the proposed system is expected to save 13,500 design hours per year; an operating cost savings of $55 per hour. the annual cash expenditures of operating the cad system are estimated to be $300,000. the cad system requires an initial investment of $750,000. the estimated life of this system is five years with no salvage value. the tax rate is 35 percent, and united technologies uses straight-line depreciation for tax purposes. united technologies has a cost of capital of 14 percent.

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