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A backactor (Backhoe) will be purchased for a cost of $109,750. After a useful life of...

A backactor (Backhoe) will be purchased for a cost of $109,750. After a useful life of 5 years, it is assumed the equipment will be sold for $35,000. Assume interest of 8% for borrowing money, 4% for risk and 2% for taxes, insurance, and storage. Calculate the annual ownership cost and the cost per hour in year 1 assuming the equipment will be used 1,800 hr/year.

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