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Practice Questions
Test your understanding with targeted questions related to the topic.
Question 1
Easy
What does EAC stand for?
💡 Hint: What annual cost do we evaluate concerning equipment?
Question 2
Easy
What is USCRF used for?
💡 Hint: Think about how we share costs over time.
Practice 4 more questions and get performance evaluation
Interactive Quizzes
Engage in quick quizzes to reinforce what you've learned and check your comprehension.
Question 1
What does EAC help businesses to determine?
- Annual profit
- Cost variations
- Best time for replacement
💡 Hint: Focus on the effectiveness of cost management.
Question 2
True or False: Cumulative costs only account for initial purchase costs.
- True
- False
💡 Hint: Think about total expenditures over time.
Solve 1 more question and get performance evaluation
Challenge Problems
Push your limits with challenges.
Question 1
A company purchased a machine for 2,500,000 rupees. It has annual maintenance costs of 150,000 rupees and a projected resale value of 500,000 rupees after 5 years. Calculate the EAC assuming an interest rate of 10%.
💡 Hint: First determine present values and apply them against the USCRF.
Question 2
An organization is considering two machines. Machine A has an EAC of 1,000,000 rupees, while Machine B has 950,000 rupees. Discuss factors other than EAC that should influence a decision on which machine to purchase.
💡 Hint: Reflect on non-financial aspects that impact long-term value.
Challenge and get performance evaluation