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Not sure where to ask this, but I had this question that asked to do a differential analysis (pretty sure that's the english term, the class is in French) where a company currently sells 60k units a year, with a revenue of 2M\$, variable cost of 1M\$ and fixed cost of 500k\$. They sell the old equipment for 180k\$ and acquire the new equipments for a total of 800k\$ amortized over 20 years with a remaining value of 100k\$ (along with other informations about the yearly fixed costs, the variable costs etc.). I know that the differential analysis is related to costs and revenues that recures every year, but hat I'm not sure is how do I include those costs / revenues that are only for one year (Ex. the 800k\$ related to the initial investment)? Also what do I do about amortizement?

Thanks

qwerty_99
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  • I’m voting to close this question because it is basically an accounting question with little direct relevance to QF. – Alper Oct 29 '22 at 04:05
  • Your questions are very basic and can be answered by looking carefully at an example worked out in any Corporate Finance textbook. – nbbo2 Oct 29 '22 at 10:23

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