An untreated electric wooden pole that will last 15 years under a certain soil condition costs P1500. If a treated pole will last for 25 years, what is the maximum justifiable amount that can be paid for the treated pol, if the maximum return on investment is 15%? Consider annual taxes and insurance amount to 2% of first cost.

Q: A machine is priced at 100,000 TL by its seller. For the person who will buy the machine Talk useful…

A: We have to calculate the present value of all the future cash inflows.

Q: The annual maintenance costs of a tunnel, which is considered to have an eternal life, are worth 500…

A: Total capitalised cost include the initial cost of investment and the present value of annual cost…

Q: Consider the investment in a wind turbine with the data below. You are told the fixed charge rate…

A: LCOE stands for Levelized Cost of Energy/ Electricity. This is a method which is used when someone…

Q: The Atlantic Medical Clinic can purchase a new computer system that will save $5,000 annually in…

A: The question is related to the Capital Budgeting. The details are given regarding the same.  It…

Q: Fantastic Footwear can invest in one of two different automated clicker cutters. The​ first, A, has…

A: The IRR represents the actual return provided to the project. The IRR is used to measure the…

Q: The following are the costs for one of the alternatives to construct a new bridge: Construction cost…

A: We are given the costs of an alternative to construct a new bridge.  The initial construction cost…

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: Elijah Enterprises will need to upgrade the computer system in 8 years. They anticipate the upgrade…

A: Time = t = 8 YearsFuture Value = fv = $112,100Discount Rate = r = 11%

Q: Raghubhai

A: The objective of this question is to calculate the Net Present Value (NPV) of the purchase of a new…

Q: Savings of $5600 per year can be achieved through either a $14 000 machine (A) with a seven-year…

A: The concept of money's time value indicates that any sum today is worth more than what it will be in…

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: ou can continue to use your less efficient machine with a maintenance cost of $7,780 annually for…

A: Equivalent annual cost is the cost of operating and maintaining an asset annually. It is also called…

Q: There are three alternatives with the following details: A B Investment cost ($) 50 150 110 Uniform…

A: Note: The question above has been solved using the discounted payback period technique since the…

Q: An adoption of a new system will lead to a reduction of the cost by as much as 18%. The cost of the…

A: The rate of return will be the IRR of this capital budgeting project. As the tax rate is not given…

Q: A new high-efficiency motor is being considered for a large compressor. The new motor will cost…

A: Payback Period is the time duration taken to reap back the amount invested in the project. The…

Q: The Atlantic Medical Clinic can purchase a new computer system that will save $7,000 annually in…

A: Annual savings = $7,000Period =9 yearsNote : Here we have to use the present value of the annuity…

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Q: An investment company wants to study the usage of new technology for one of its clients. This…

A: Human Hour Per month = 187 Average Savings per Human hour = $450 Average savings per month =…

Q: Assume a machine costs $250,000 and lasts five years before it is replaced. The operating cost is…

A: Present value annuity factor is calculated as follows:-PVAF = wherePVAF = present value annuity…

Q: Mr Dela Cruz is going to buy a new machine for manufacturing its product: Machine A has a first cost…

A: The net gain or loss of an investment over a specific time period, stated as a percentage of the…

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

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Q: A new transmission in your truck will cost $9500. Luckily it should reduce maintenance expense by $…

A: Given Data: Year Cash Flows131502315033150431505315063150731508315093150103150Initial…

Q: Consider a processing center that can be purchased at $25000 today and will have a 10 years of…

A: Present worth of an investment is the summation of each cash flow expected to be generated in coming…

Q: A store plans on investing on a new grill oven that costs P100,000. It will generate revenues of…

A: Net present value method(NPV): NPV  considers  time value of money and is used for analyzing…

Q: 3. You are planning to build a small Savonius wind power system that will provide 8600 kWh of…

A: Given: Installation cost of system = $1.62/W = $1.62*1000/kW Capacity factor, CF = 18% = 0.18 Life,…

Q: An energy conservation option with a first cost of $10,000 is installed. It requires $600 per year…

A: Life cycle costing is the calculation of the total amount which an entity will spend throughout the…

Q: NPV

A: Formula to calculate the NPV is: NPV = Cash flows/(1+i)^n - Initial investment

Q: Two pumps are being considered to replace an old one. The details of the two pumps are shown below.…

A: Step 1 We have MARR = 15 % First let us note down the 15 % interest table :   3 years 6…

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Q: A new electronic process monitor costs $990,000. This cost could be depreciated at 30% per year (…

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Q: Your company is planning to purchase a new loader for $20,937. If the company keeps the old loader,…

A: Present Value is the current price of future value which will be received in near future at some…

Q: A new machine costs $1,050,110 and falls in a 34.00% CCA class. The machine will have zero value…

A: NPV is the difference between the present value of cash inflows and the present value of cash…

Q: A new die press machine costs $ 150,000, and lasts 8 years with salvage value of $20,000. Annual…

A: We need to use present worth (PW) formula below to calculate the minimum annual revenue required…

Q: Elijah Enterprises will need to upgrade the computer system in 10 years. They anticipate the upgrade…

A: Yearly investments or payments refer to the periodic deposits that are made to fund future…

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 new electronic process monitor costs $990,000. This cost could be depreciated at 30 percent per…

A: NPV gives a clear picture of whether an investment is projected to make money or lose money. Whereas…

Q: The average annual electricity consumption for a single-family house is 5000 kWh with the cost per…

A: Since you have posted a question with multiple sub-parts, we will solve first three sub-parts for…

Q: Considering an interest rate of 8%, that the cost of the equipment is $300,000 and you will replace…

A: Where the actual cost of equipment is dividing over the life of equipment is called annual 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.