A 1000ft (one lane) asphalt road costs P3.8M. It requires no upkeep until the end of 3 years when P80,000 will be needed for repairs. After this P90,000 will be needed for repairs at the end of each year for the next 4 years, then P120,000 thereafter. Rework cost of 1.5M is expected every 6 years. If money is worth 11% compounded annually, what was would be the equivalent uniform annual cost for a 20-year period.

Q: Salalah Methanol Co. has bought some new machinery at a cost of 1250000 OMR. The impact of the new…

A: Capital budgeting approaches are the methodologies adopted by the top-level management to evaluate…

Q: A dam will have a first cost of P250,000,000, an annual maintenance cost of P1,250,000 and minor…

A: A capitalized cost seems to be a cost incurred as a consequence of the acquisition of a fixed asset…

Q: An asphalt road requires no upkeep until the end of 2 years when P60, 000 will be needed for…

A: Equivalent uniform annual cost is the annual cost of repairing, maintaining an asset over its useful…

Q: Maintenance cost for a small bridge expected to last for 60 years is estimated to be Php1,000 each…

A: The yearly cost of owning, operating, and sustaining an asset throughout its entire life is referred…

Q: It costs P50,000 at the end of each year to maintain a section of Kennon road in Baguio City. If mor…

A: Value of money changes with time and amount invested and money can be earned elsewhere by investing…

Q: A new water treatment plant proposed for Anytown, has an initial cost of P56 million. The new plant…

A: In this question we need to compute the benefit/cost ratio.

Q: The generator set requires no maintenance until the end of 2 years when P60,000 will be needed for…

A: Here, At the end of year 2 , maintenance cost is P60,000 From Year 3 to Year 7, Maintenance Cost is…

Q: A special purpose machine toolset costs $20,000. The toolset will be financed through a bank loan of…

A: The question is based on the calculation for benefit of buying a special purpose machine , which is…

Q: A factory company has 5 years to prepare for relocating in another place. The equipment for loading…

A: Capital rate per year can be defined as the amount to be capitalized on annual basis. It is…

Q: The initial cost of a van is $22,800; its salvage value after 5 years will be $8500. Maintenance is…

A: The equivalent uniform annual cost(EUAC) is the annual cost of maintaining and operating assets…

Q: A certain machine costs GH¢25000 and lasts 6 years, after which time it has a scrap value of…

A: A capitalized cost of an asset is the cost incurred on an asset to put it to use. Capitalized cost…

Q: Ive ye is the payback period for - If their acceptance peric

A: The Payback period is the amount of time needed to earn back the cost of an investment. This method…

Q: 3% compounded annually, what was the equivalent uniform annual cost for the 12-year period? Include…

A: An item of expenditure on a capital asset that brings back the asset to its working position is…

Q: A computer purchased for $1200 will have a salvage value of $600 after 6 years. Annual maintenance…

A: EUAC or Equivalent uniform annual cost is the annual cost associated with operating and maintaining…

Q: .Calculate the NPV method and discount rate of 12%

A: Net Present Value (NPV) is a capital budgeting technique used for finding the profitability of the…

Q: The maintenance costs of a new boiler are estimated as follows: P 600 per year for the first 3…

A: As per question , we are provided : Future value of all maintenance = P20000 Compounding rate = 6%…

Q: The maintenance cost of a certain equipment is P80,000.00 per year for the first 5 years,…

A: The present value is the value of the sum received at time 0. It is the current value of the sum…

Q: I have purchased a machine worth P1.862.585.00. And it needs maintenance at the end of every 6…

A: Purchase Price = 1,862,585 Maintenance Cost = 2% of Purchase Price = 2% * 1.862,585 = 37,251.70…

Q: A new gizmo costs $9050. Maintenance costs $6907 per year and labour savings are $1900 per year.…

A: The payback period is a financial metric that is commonly used to determine how long it will take…

Q: onsider the following project. Costs: $100,000, at time t = 0. $45,000, at time t = 4. Income: Three…

A: The question is based on the concept of calculating the future value of cash flows in a project at…

Q: A new gizmo costs $10 000. Maintenance costs $2000 per year and labour savings are $6567 per year.…

A: The payback period refers to the period that is required to recover the initial cost. With the help…

Q: Improvements with an initial investment cost of 67,000 TL will be made in an assembly line. Yearly…

A: Company uses capital budgeting techniques for the purpose of evaluating different projects. In the…

Q: An aggregate crasher is expected to cost P60, 000 and has an estimatedlife of 5 years. Maintenance…

A: Here we will use the concept of time value of money. As per the concept of time value of money the…

Q: machine cost is $50,000. fuel and minor repair cost is cost is # 15.00 per hour. A set of tire costs…

A: Salvage value is the expected book value of an asset after depreciation, based on what the firm…

Q: A proposed 10-mile, 4-lane road widening project is worth 3.6 million. The existing daily traffic is…

A: In a typical capital budgeting project, there are drivers of benefits as well costs. We have to find…

Q: A new machine costs $10 000. Maintenance costs $2000 per year and labour savings are $6567 per year.…

A: The payback period alludes to what extent it takes for a speculator to hit breakeven to recoup the…

Q: A machine costs Php 30,000 to purchase. The machine will have a Maintenance cost of Php 2,000 but…

A: Initial cost = Php 30000 Annual profit (CF)= Php 10000 - Php 2000 = Php 8000 Salvage value = Php…

Q: A new punching machine will cost $4,593. At the end of its 10 years useful life, the machine can be…

A: NPV is also known as Net present value. It is a capital budgeting techniques which help in decision…

Q: crete road requires no upkeep until the end of 3 years when P54, 000 will be needed for repairs.…

A: The annual cost of owning, operating, and maintaining property for the rest of its life is known as…

Q: A constructed bridge requires no upkeep until the end of 2 years when P60,000 will be needed for…

A:

Q: A new airconditioning unit costs P150,000 and will have a salvage value of P15,000 after 5 years.…

A: First cost (F) = P 150000 Let A = Annual saving Salvage value (S) = P 15000 n = 5 years r = 15%

Q: A water Reservoir will have a first cost of Php 10,000,000,000, an annual maintenance cost of…

A: First cost (C) = Php 10,000,000,000 Annual maintenance cost (A) = Php 35,000,000 Reconstruction cost…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.