Assume a proposed system has a useful life of 5 years, one-time Development costs of $50,000,...
Assume a proposed system has a useful life of 5 years, one-time Development costs of $50,000, recurring Operation and Maintenance costs of $25,000 per year, and tangible benefits of $45,000 per year. If the Discount factor is 10%, what is the overall NPV of this alternative? Overall ROI? Breakeven point?
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Assume a proposed system has a useful life of 5 years, one-time
Development costs of $50,000,...
A new registration system for the university is being considered. The acquisition (development) cost is $50,000....
A new registration system for the university is being considered. The acquisition (development) cost is $50,000. For the life of the system (5 years), the estimated operating costs are $10,000 per year and the estimated benefit is $5 per student per year. 2. Consider the acquisition cost as a sunk cost. How many students are required to register per year to pay the fixed operating costs? a. b. Calculate the break-even point, number of students per year to pay for...
Assume you are in charge of launching a new website for a client of your choice....
Assume you are in charge of launching a new website for a client of your choice. Present a short overview of the mission of the organization first. Let us assume that the one‑time costs of implementing the website are $40,000 and the recurring costs are $9,000 per year. Assume the benefits are $50,000 per year. Provide the answers to the following questions: (Make sure to show the details for the breakdown of the response and draw a direct connection to...
A project where the projected costs and benefits are spread over five years with the following...
A project where the projected costs and benefits are spread over five years with the following data: • Estimated costs are $100,000 in Year 1 and $25,000 each for years 2, 3, 4, and 5. • Estimated benefits are $0 in Year 1 and $80,000 each for years 2, 3, 4, and 5. • Use a discount rate of 8% 1.Calculate the following: a. Calculate cash flow b. Show the discount factor c. Show discounted costs and discounted benefits d....
A proposed airport terminal is expected to cost $16,000,000 with a life of 40 years. See...
A proposed airport terminal is expected to cost $16,000,000 with a life of 40 years. See Figure 3. The operating and maintenance costs are estimated as follows. • Operations begin at $1,000,000/year rising $50,000/year/year • Maintenance begin at $500,000/year rising 10% per year • Rehabilitation at the end of every 10 years $2,000,000 All costs of the terminal, including construction, will be financed at 6% and will be repaid by charging each passenger an "airport" fee. (a) Assuming 1,000,000 passengers...
We are evaluating a project that costs 680000 has a life of 5 years and has...
We are evaluating a project that costs 680000 has a life of 5 years and has no salvage value. Assume that depreciation is straight line to zero over the life of the project. Sales are projected at 64000 units per year. Price per unit is 46, variable cost per unit is 26, and fixed costs are 685000 per year. The tax rate is 24 percent and we require and return of 14 percent on this project. Calculate the accounting breakeven...
Hardware Corp. is planning to buy production machinery. This machinery's expected useful life is 5 years,...
Hardware Corp. is planning to buy production machinery. This machinery's expected useful life is 5 years, with a $10,000 salvage value. They require a minimum rate of return of 12%, and have calculated the following data pertaining to the purchase and operation of this machinery: Year Estimated annual cash inflows $ 60,000 80,000 95,000 115,000 140,000 Estimated annual cash outflows $ 10,000 20,000 25,000 35,000 50,000 Depreciation $30,000 $30,000 $30,000 $30,000 $30,000 Determine the Payback Period, Accounting Rate of Return....
7. A proposed bridge on the interstate highway system is being considered at the cost of $2 millin It is pring 2019 expected that the bridge will last 20 years. The federal and state governments...
7. A proposed bridge on the interstate highway system is being considered at the cost of $2 millin It is pring 2019 expected that the bridge will last 20 years. The federal and state governments will pay these construction costs. Operation and maintenance costs are estimated to be $180,000 per year. Benefits to the public are estimated to be $900,000 per year. The building of the bridge will result in an estimated cost of $250,000 per year to the general...
Abdulaziz Co. purchased a machine in 2013 for 50,000 that has a useful life of 5...
Abdulaziz Co. purchased a machine in 2013 for 50,000 that has a useful life of 5 years with a salvage value of 5,000. Calculate the depreciation expense, accumulated depreciation, book value throughout its useful life using: 1- Straight-line Method. 2- Units of Production Method if the machine produces 100,000 units. Here is a table of units produced each year: First Second Third Fourth Fifth 23,000 25,000 - 30,000 22,000 3- Double Declining Balance Method
A company has just purchased a lift truck for £50,000 that has a useful life of...
A company has just purchased a lift truck for £50,000 that has a useful life of 8 years. The engineer estimates that the maintenance costs by the end of the first year will be £1500 and are expected to increase as the truck ages at a rate of £200 annually over the remaining life. Also, the truck will need an overhaul that cost £5000 by the end of the 3rdand 6thyears. The firm decided to set up a maintenance account...
We are evaluating a project that costs $650,000, has a life of 5 years, and has...
We are evaluating a project that costs $650,000, has a life of 5 years, and has no salvage value. Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 45,000 units per year. Price per unit is $56, variable cost per unit is $26, and fixed costs are $860,000 per year. The tax rate is 21 percent and we require a return of 14 percent on this project. Suppose the projections given for...
A new registration system for the university is being considered. The acquisition (development) cost is $50,000. For the life of the system (5 years), the estimated operating costs are $10,000 per year and the estimated benefit is $5 per student per year. 2. Consider the acquisition cost as a sunk cost. How many students are required to register per year to pay the fixed operating costs? a. b. Calculate the break-even point, number of students per year to pay for...
A proposed airport terminal is expected to cost $16,000,000 with a life of 40 years. See Figure 3. The operating and maintenance costs are estimated as follows. • Operations begin at $1,000,000/year rising $50,000/year/year • Maintenance begin at $500,000/year rising 10% per year • Rehabilitation at the end of every 10 years $2,000,000 All costs of the terminal, including construction, will be financed at 6% and will be repaid by charging each passenger an "airport" fee. (a) Assuming 1,000,000 passengers...
Hardware Corp. is planning to buy production machinery. This machinery's expected useful life is 5 years, with a $10,000 salvage value. They require a minimum rate of return of 12%, and have calculated the following data pertaining to the purchase and operation of this machinery: Year Estimated annual cash inflows $ 60,000 80,000 95,000 115,000 140,000 Estimated annual cash outflows $ 10,000 20,000 25,000 35,000 50,000 Depreciation $30,000 $30,000 $30,000 $30,000 $30,000 Determine the Payback Period, Accounting Rate of Return....
7. A proposed bridge on the interstate highway system is being considered at the cost of $2 millin It is pring 2019 expected that the bridge will last 20 years. The federal and state governments will pay these construction costs. Operation and maintenance costs are estimated to be $180,000 per year. Benefits to the public are estimated to be $900,000 per year. The building of the bridge will result in an estimated cost of $250,000 per year to the general...
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