a) Drago Distribution handles the warehousing of perishable foods and is consi

a) Drago Distribution handles the warehousing of perishable foods and is considering replacing
one of its primary cold storage units. One supplier has offered a unit for $250000 with an expected life of 10 years. The unit is projected to reduce
electricity costs by $50000 per year. However it requires a $20000 refurbishing every 2 years beginning 2 years after the purchase. Another supplier has
offered similar capabilities for $300000 and it will produce same savings and results but requires refurbishing every 5 years at a cost of $40000. Their cost
of capital is 8.5 %. Use NPV to determine which cold storage unit they should buy?