Chapter 10 - Suppose we have a company that is considering undertaking a project. The annual cash flows and equipment salvage values are provided belov Operating Cash Flow Year Salvage Value -$5,000 $2,500 $2,000 $1,500 $1,000 $4,000 $3,000 $2,000 $0 |Salvage value if the equipment is sold at the end of year 1 Salvage value if the equipment is sold at the end of year 2 Salvage value if the equipment is sold at the end of year 3 Salvage value if the equipment is sold at the end of year 4 1 2 3 4 WACC = 10% How many years should this company keep the project going? The answer is either 1 year, 2 years, 3 years or 4 years. Note #1: You don't need to consider anything else other than the information provided above. For example, taxes are already factored into these numbers. Note #2: You might find Chapter 10 slides 29 and 30 helpful and the Chapter 10 Tool Kit Answers tab beginning on row 483. Optimal # of Years =

Chapter 10 - Suppose we have a company that is considering undertaking a project. The annual cash flows and equipment salvage values are provided belov Operating Cash Flow Year Salvage Value -$5,000 $2,500 $2,000 $1,500 $1,000 $4,000 $3,000 $2,000 $0 |Salvage value if the equipment is sold at the end of year 1 Salvage value if the equipment is sold at the end of year 2 Salvage value if the equipment is sold at the end of year 3 Salvage value if the equipment is sold at the end of year 4 1 2 3 4 WACC = 10% How many years should this company keep the project going? The answer is either 1 year, 2 years, 3 years or 4 years. Note #1: You don't need to consider anything else other than the information provided above. For example, taxes are already factored into these numbers. Note #2: You might find Chapter 10 slides 29 and 30 helpful and the Chapter 10 Tool Kit Answers tab beginning on row 483. Optimal # of Years =

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Required information Assume you started a sideline business in commercial photography last year using your then-owned equipment. Due to excellent success, you plan to purchase new equipment and upgrade your studio facility. First cost of equipment, $ -160,000 Annual expenses, $ per year -45,000 Annual revenue, $ per year 75,000 Determine the no-return payback period. The no-return payback period is years.
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(engineering economic) A contractor gets a large project that is expected to last for 10 years, during which the project takes a special tool that he does not have. There are two offers of tools to the contractor, both of which can meet their needs, namely: Determine which tool is more profitable to buy based on i = 15% by using: a. Annual Value Analysis with repeatability assumption b. Annual Value Analysis with the purchase price of alternative X at the time of replacement there is an increase of 20%
The following data relate to the operations of Shilow Company, a wholesale distributor of consumer goods: Current assets as of March 31: Cash Accounts receivable Inventory Buildings and equipment, net Accounts payable Common shares Retained earnings a. The gross margin is 25% of sales. b. Actual and budgeted sales data are as follows: March (actual) April May June $50,000 $60,000 $72,000 $ 8,000 20,000 36,000 120,000 21,750 150,000 12,250 July $90,000 $48,000 c. Sales are 60% for cash and 40% on credit. Credit sales are collected in the month following sale. The accounts receivable at March 31 are the result of March credit sales. d. Each month's ending inventory should equal 80% of the following month's budgeted cost of goods sold. e. One-half of a month's inventory purchases is paid for in the month of purchase; the other one-half is paid for in the following month. The accounts payable at March 31 are the result of March purchases of inventory. f. Monthly expenses are as follows:…
16-24 The Highridge Water District needs an additional supply of water from Steep Creek. The engineer has selected two plans for comparison: Gravity plan: Divert water at a point ten miles up Steep Creek and carry it through a pipeline by gravity. Pumping plan: Divert water at a point near the district and pump it through two miles of pipeline. The pumping plant can be built in two stages, half now and half ten years hence. Alternative Gravity Pumping Initial investment 2,500,000 1,250,000 Investment at end of year 10 O&M cost/year Average annual power cost: 150,000 12,500 20,000 Years 1-10 40,000 Years 11-35 75,000 Annual benefits for each alternative are $190,000/year. Analysis period is 35 years. Disregard residual values. Choose between these alternatives using conventional benefit-cost analysis. Doing nothing is not an option here.
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Subject: Engineering Economics Lesson: Capitalized Cost A machine costs P 500,000 with a yearly maintenance of P 75,000. Considering it has no salvage value at the end of its five-year life and that is should be replaced every five years as recommended by the maintenance engineer. What is the total capitalized cost of the entire investment? Money is worth 5%. (Show solution)
kuzukuzu12121@outlook.com just sent here I NEED EXCEL FİLE. Determine the NPW, AW, FW and IRR of the following engineering project. Initial Cost ($400,000) The Study Period 15 years Salvage (Market) Value of the project 15% of the initial cost Operating Costs in the first year($9,000) Cost Increase 3% per year Benefits in the first year $40,000 Benefit Increase 9% per year MARR 8% per year Is the Project acceptable? WHY?
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