Cellphone cost P12,000 new. It is estimated to have a life of 5 years with a salvage value at the end of life of P1,000. Determine the book value at 4th year. a. P3,200 b. P1,733 c. P5,400 d. P8,333
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Cellphone cost P12,000 new. It is estimated to have a life of 5 years with a salvage value at the end of life of P1,000. Determine the book value at 4th year.
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- . A manager has been presented with two proposals for automating a production process. Proposal A involves an initial cost of $15,000 and an annual operating costof $2,000 per year for the next 4 years. Thereafter, the operating cost is expected to increase by $100 per year. This equipment is expected to have a 10-year life with no salvage value.Proposal B requires an initial investment of $28,000 and an annual operating cost of $1,200 per year for the first 3 years. Thereafter, theoperating cost is expected to increase by $120 per year. This equipment is expected to last for 20 years and will have a $2,000 salvage value. If the company's minimum attractive rate of return is 10%, which proposal should be accepted on the basis of present worth analysis?IPS Corp. will upgrade its package-labeling machinery. It costs $850,000 to buy the machinery and have it installed. Operation and maintenance costs, which are $11,000 per year for the first 3 years, increase by $1000 per year for the machine’s 10-year life. The machinery has a salvage value of 12% of its initial cost. Interest is 25%. What is the future worth of cost of the machinery? dont use excel. dont write answer in a paper becouse of handwriting. thanksEngineering economy - ENGR 3322 The International Parcel Service has installed a new radio frequency identification system to help reduce the number of packages that are incorrectly delivered. The capital investment in the system is $65,000, and the projected annual savings are tabled below. The system’s market value at the EOY five is negligible, and the MARR is 18% per year. Calculate the present worth of the project. a. $ 35,730 b. $ 36,730 c. $ 37,730 d. None of the choices
- From the data shown, determine the ESL of the asset. (Note: Values in the table are AW values, not individual year end values.) AW of First Cost, $ AW of Salvage Value, $ AW of Operating Cost, $ -48000 164000 99,000 -36000 38,095 47000 18,127 -53000 6464 49000 3276 Years Retained 1 2 3 4 5 The ESL of the asset is year(s). -148000 -162000 134000 1540001. The data for new and used machines are shown below: Initial cost($) Annual operating cost ($/year) Salvage value ($) Life (years) Used machine 15,000 8,000 5,000 3 New machine 40,000 2,000 10,000 6 Using an interest rate of 10% per year, determine the present worth of the new machine.You have been asked to perform a sensitivity analysis on a plant modernization plan. The initial investment is $30,000. Expected annual savings is $13,000. Salvage value is $7,000 after a 7 year planning horizon. The MARR is 12%. Determine the AW if the annual savings change by the following percentages from the initial estimate: b. -80%c. -60%d. -40%e. -20%f. +20%g. +40%h. Determine the percentage change in net annual savings that causes a reversal in the decision regarding the attractiveness of the project
- Don Garlis is a landscaper. He is considering the purchase of a new commercial lawn mower, either the Atlas or the Zippy. Construct a choice table for the interest rates of 0-100%. Atlas Zippy Initial cost $6,700 $16,900 Annual maintenance cost $1,500 $1,200 Annual benefit $4,000 $4,500 Salvage value $1,000 $3,500 Useful live, in years 3 6which process line should be built for a new chemical? the expected market for the chemical is 16 years. an 18% rate is used to evaluate new process facilities, which are compared with present worth. how much does the better choice save? First cost O &M cost/year salvage life A $14 M $2.5 M $2 M 8 years B 22 M 3 M 7.5 M 16 years2. One year ago, a machine was purchased at a cost of $2,000, to be used for 6 years.However, the machine has failed to perform properly and has a cost of $500 per year forrepairs, adjustments, and shutdowns. A new machine is available to accomplish thefunctions desired and has an initial cost of $3,500. Its maintenance costs are expected tobe $50 per year during its service of 5 years. The approximate market value of the presentmachine has been roughly $1,200. If the operating cost (other than maintenance) for bothmachines are equal, show whether it is economical to purchase the new machine. Performa before-tax study, using an interest rate of 12% and assume that the salvage values will benegligible.
- 5. A small branch office of a contracting company is planning to purchase a new laser printer. Three vendors have supplied cost, useful life, and estimated salvage value data, shown in the following table. The MARR is 12%. Investment (first) cost Annual service cost Salvage value Useful life A $800 $180/yr $200 5 years Laser printer B $1,400 $150/yr $825 5 years C $900 $170/yr $100 5 years Draw cash flows for these alternatives. If the expected annual saving in labor is $500 regardless of which machine is purchased, what are the annual equivalent values of these alternatives.A manufacturer with a MARR of 20% is considering the installation of one of three packaging machines. The economic parameters of each machine are as follows: Packaging machine: Initial cost ($) Uniform annual benefit ($) Uniform annual O&M cost ($) X Y 20,000 40,000 120,000 180,000 70,000 50,000 6 Service life (years) 3 Salvage value end of life ($) 2,000 4,000 Z 15,000 100,000 70,000 12 2,000 Which choice below gives the correct PW equation for machine X over the appropriate analysis period? O PW (costs) = $20k + $20k (P/F,20%,6) + $70k (P/A,20%, 12) - $2k (P/F,20%,6) - $2k (P/F,20%,12) NPW = [ $120k (P/A,20%, 12) ] - [ $20k + $20k (P/F,20%,6) + $70k (P/A, 20%, 12) - $2k (P/F,20%,6) - $2k (P/F,20 %,12)] PW (benefits) = $120k (P/A,20%, 12) O NPW = ($120k-$70k) (P/A,20%,12)A company is considering the purchase of either machine A or machine B. And the interest rate is 10%. The following table shows the cash flows of both machines. Machine Initial investment ($) Other costs ($) Service life (years) Salvage value ($) Cash flow diagram for Machine A: A $80,000 $10,000 for the first 10 years, increasing at a rate of 5% from year 11 onwards 20 20,000 PW of machine A: B $100,000 $15,000 for the first 15 years and $20,000 for the remaining years a) Which alternative should the company choose if it adopts an interest rate of 10%? Use present worth (PW) method to evaluate the two machines and show your calculations in the space given below. 20 25,000