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lucing their own headsets in-house. The company estimates that the transition will take place over 12 months. The system is expected to have an eight-year service life and produce savings e table below. se the NPW method to calculate the economic worth of producing the headsets in house. e table for the savings and expenditures of the system. e interest factors for discrete compounding when MARR = 15% per year. ucing the headsets in house is $thousand. (Round to the nearest whole number. X More Info ouse Headset Manufacturing stment Single Payment Compound Present Amount Compound Equal Payment Series Sinking Present Fund Worth Factor Factor Worth Now (building) $500,000 Amount Factor Factor Factor $2,200,000 First year (equipment and Facilities) (P/F, i, N) (F/A, i, N) (A/F, i, N) (F/P, i, N) 1.1500 (P/A, i, N) 0.8896 0.8896 1.0000 1.0000 al savings in materials and $5,000,000 1.3225 0.7561 2.1500 0.4651 1.6257 ty inspection 1.5209 0.6575 3.4725 0.2880 2.2832 $1,500,000 $800,000 1.7490 0.5718 4.9934 0.2003 2.8550 mental annual expenses mental annual income taxes omic service life salvage value 2.0114 0.4972 6.7424 0.1483 3.3522 8 years $1,500,000 2.3131 0.4323 8.7537 0.1142 3.7845 2.6800 0.3759 11.0668 0.0004 4.1604 3.0590 0.3269 13.7288 0.0729 4.4873 3.5179 0.2843 16.7858 0.0596 4.7716 4.0456 0.2472 20.3037 0.0493 5.0188 Print Done WNIZ 2 3 45 6 7 8 9 10 Print Done Capital Recovery Factor (A/P, i, N) 1.1500 0.6151 0.4380 0.3503 0.2983 0.26842 0.2404 0.2229 0.2096 0.1993 -

lucing their own headsets in-house. The company estimates that the transition will take place over 12 months. The system is expected to have an eight-year service life and produce savings e table below. se the NPW method to calculate the economic worth of producing the headsets in house. e table for the savings and expenditures of the system. e interest factors for discrete compounding when MARR = 15% per year. ucing the headsets in house is $thousand. (Round to the nearest whole number. X More Info ouse Headset Manufacturing stment Single Payment Compound Present Amount Compound Equal Payment Series Sinking Present Fund Worth Factor Factor Worth Now (building) $500,000 Amount Factor Factor Factor $2,200,000 First year (equipment and Facilities) (P/F, i, N) (F/A, i, N) (A/F, i, N) (F/P, i, N) 1.1500 (P/A, i, N) 0.8896 0.8896 1.0000 1.0000 al savings in materials and $5,000,000 1.3225 0.7561 2.1500 0.4651 1.6257 ty inspection 1.5209 0.6575 3.4725 0.2880 2.2832 $1,500,000 $800,000 1.7490 0.5718 4.9934 0.2003 2.8550 mental annual expenses mental annual income taxes omic service life salvage value 2.0114 0.4972 6.7424 0.1483 3.3522 8 years $1,500,000 2.3131 0.4323 8.7537 0.1142 3.7845 2.6800 0.3759 11.0668 0.0004 4.1604 3.0590 0.3269 13.7288 0.0729 4.4873 3.5179 0.2843 16.7858 0.0596 4.7716 4.0456 0.2472 20.3037 0.0493 5.0188 Print Done WNIZ 2 3 45 6 7 8 9 10 Print Done Capital Recovery Factor (A/P, i, N) 1.1500 0.6151 0.4380 0.3503 0.2983 0.26842 0.2404 0.2229 0.2096 0.1993 -

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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FootballComm LLC is a manufacturer of devices for football coaches and their coaching staffs that enables them to quickly and effectively communicate with one another during a game through a wireless sideline headset system. Currently, the company purchases all of the headsets included in their systems from a China-based supplier, but they have experienced a significant decrease in overall headset quality. To correct the problem, the company is considering producing their own headsets in-house. The company estimates that the transition will take place over 12 months. The system is expected to have an eight-year service life and produce savings and expenditures given in the table below. If the firm's MARR is 15%, use the NPW method to calculate the economic worth of producing the headsets in house. Click the icon to view the table for the savings and expenditures of the system. Click the icon to view the interest factors for discrete compounding when MARR = 15% per year. The economic worth of producing the headsets in house is $ thousand. (Round to the nearest whole number. - X More Info More Info Single Payment In-House Headset Manufacturing Investment Compound Present Amount Factor Worth Now (building) Equal Payment Series Sinking Present Fund Worth Factor Factor (A/F, i, N) (P/A, i, N) 0.8696 $500,000 Compound Amount Factor (F/A, i, N) 1.0000 $2,200,000 (F/P, i, N) Factor (P/F, i, N) 0.8896 First year (equipment and facilities) 1.1500 1.0000 $5,000,000 Annual savings in materials and quality inspection 1.3225 0.7561 2.1500 0.4651 1.6257 1.5209 0.6575 3.4725 0.2880 2.2832 $1,500,000 Incremental annual expenses Incremental annual income taxes $800,000 1.7490 0.5718 4.9934 0.2003 2.8550 Economic service life 2.0114 0.4972 6.7424 0.1483 3.3522 8 years $1,500,000 Net salvage value 2.3131 0.4323 8.7537 0.1142 3.7845 2.6600 0.3759 11.0668 0.0004 4.1604 3.0590 0.3269 13.7268 0.0729 4.4873 3.5179 0.2843 16.7858 0.0596 4.7716 4.0458 0.2472 20.3037 0.0493 5.0188 Print Done N 1 2 3 4 5 6 7 8 9 10 Print Done Capital Recovery Factor (A/P, i, N) 1.1500 0.6151 0.4380 0.3503 0.2983 0.2642 0.2404 0.2229 0.2096 0.1993
Transcribed Image Text:FootballComm LLC is a manufacturer of devices for football coaches and their coaching staffs that enables them to quickly and effectively communicate with one another during a game through a wireless sideline headset system. Currently, the company purchases all of the headsets included in their systems from a China-based supplier, but they have experienced a significant decrease in overall headset quality. To correct the problem, the company is considering producing their own headsets in-house. The company estimates that the transition will take place over 12 months. The system is expected to have an eight-year service life and produce savings and expenditures given in the table below. If the firm's MARR is 15%, use the NPW method to calculate the economic worth of producing the headsets in house. Click the icon to view the table for the savings and expenditures of the system. Click the icon to view the interest factors for discrete compounding when MARR = 15% per year. The economic worth of producing the headsets in house is $ thousand. (Round to the nearest whole number. - X More Info More Info Single Payment In-House Headset Manufacturing Investment Compound Present Amount Factor Worth Now (building) Equal Payment Series Sinking Present Fund Worth Factor Factor (A/F, i, N) (P/A, i, N) 0.8696 $500,000 Compound Amount Factor (F/A, i, N) 1.0000 $2,200,000 (F/P, i, N) Factor (P/F, i, N) 0.8896 First year (equipment and facilities) 1.1500 1.0000 $5,000,000 Annual savings in materials and quality inspection 1.3225 0.7561 2.1500 0.4651 1.6257 1.5209 0.6575 3.4725 0.2880 2.2832 $1,500,000 Incremental annual expenses Incremental annual income taxes $800,000 1.7490 0.5718 4.9934 0.2003 2.8550 Economic service life 2.0114 0.4972 6.7424 0.1483 3.3522 8 years $1,500,000 Net salvage value 2.3131 0.4323 8.7537 0.1142 3.7845 2.6600 0.3759 11.0668 0.0004 4.1604 3.0590 0.3269 13.7268 0.0729 4.4873 3.5179 0.2843 16.7858 0.0596 4.7716 4.0458 0.2472 20.3037 0.0493 5.0188 Print Done N 1 2 3 4 5 6 7 8 9 10 Print Done Capital Recovery Factor (A/P, i, N) 1.1500 0.6151 0.4380 0.3503 0.2983 0.2642 0.2404 0.2229 0.2096 0.1993
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