Evaluating replacement cost, Finance Basics

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Evaluating replacement cost

You have acquired a new CT scanner at a cost of $750,000. You expect to perform 7,000 procedures per year over the estimated 5-year life of the scanner. Assuming no salvage value and an annual increase in replacement cost of 10 percent, what capital charge per procedure should the hospital charge levy to provide for replacement cost in the second year? (Ignore financing costs and investment income offsets.)

Choose the correct answer:

A. $25.93

B. $25.71

C. $21.43

D. $107.14

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Finance Basics: Evaluating replacement cost

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Finance Basics: Evaluating replacement cost

Reference No:- TGS052216

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Recent Questions Asked Finance Basics

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Finance Basics: Evaluating replacement cost

Reference No:- TGS052216

Recent Questions Asked Finance Basics

Q : Determine interest expense for the year

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