The tabulation of the incremental cash flows between alternative The tabulation of the incremental..

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The tabulation of the incremental cash flows between alternative
The tabulation of the incremental cash flows between alternatives A and B is shown on the next page. Alternative A has a 3-year life and alternative B a 6-year life. If neither alternative has a salvage value, what is
(a) The first cost of alternative A
(b) The first cost of alternative B?
Incremental
Year Cash Flow (B – A), $
0 ……….. –20,000
1 ……….. 5,000
2 ……….. 5,000
3 ……….. 12,000
4 ……….. 5,000
5 ……….. 5,000
6 ……….. 5,000

The tabulation of the incremental cash flows between alternative