The Queen Enterprise Wants to Purchase a Large Rotary Screw

Multiple Choice

The Queen Enterprise wants to purchase a large rotary screw air compressor. The company has looked at models of two major manufacturers: Ingersoll-Rand and DeWalt. The projected cash flows for each are shown below:

-Calculate the total cost of ownership (TCO) for the DeWalt compressor, with an annual discount rate of 12%, and the total cost of ownership (TCO) for the Ingersoll-Rand compressor, with an annual discount rate of 12%. Which model should be purchased based on these calculations?

A) Ingersoll-Rand product
B) DeWalt product
C) Either one can be purchased.
D) Neither, since both will incur enormous loss.
E) Need additional information to decide