If Morgan Tool & Die Co. acquires a new turret lathe, the lathe will cost $80,000, transportation $6,000, installation $7,500. Installing the new lathe will allow Morgan to reduce its finished goods inventory by $10,000

For capital budgeting purposes, the initial investment required for the new lathe is
A) $83,500.
B) $87,500.
C) $93,500.
D) $103,500.

Answer: A

Business

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