Compute the ”Capitalized Costs” for Alternates “ R” and” S” using the interest rate of 10% and then select the best choice.
“ R “ First Cost - $120,000, Annual Operating Cost - $40,000, Salvage Value - $50,000, and Life (years) - 5
“ S “ First Cost - $800,000, Annual Operating Cost - $12,000, Salvage Value - $600,000, Life (years) – infinite