Construction Accounting And Financial Management (4th Edition)
4th Edition
ISBN: 9780135232873
Author: Steven J. Peterson MBA PE
Publisher: PEARSON
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Chapter 17, Problem 17P
Your company is looking at purchasing a dump truck at a cost of $65,000. The truck would have a useful life of five years. At the end of the fifth year the salvage value is estimated to be $10,000, The dump truck could be billed out at $68.00 per hour and costs $13.00 per hour to operate. The operator costs $35.00 per hour. Using 1,000 billable hours per year, determine the
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You are considering purchasing a dump truck. The truck will cost $45,000 and have operating and maintenance costs that start at $15,000 in the first year and increase by $2,000 per year thereafter. Assume that the salvage value at the end of five years is $9,000 and the interest rate is 12%. Determine the equivalent annual cost of owning and operating the truck.
Your company is looking at purchasing a front-end loader at a cost of $120,000. The loader can be billed out at $107.00 per hour. It costs $30.00 per hour to operate the front-end loader and $37.00 per hour for the operator. The useful life of the equipment is five years. Using 1,200 billable hours per year and a MARR of 10%, determine the payback period with interest for the front-end loader.
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A construction firm is considering establishing an engineering computing center. The center will be equipped with three engineering workstations that cost $45,000 each, and each has a service life of five years. The expected salvage value of each
workstation is $2,000. The annual operating and maintenance cost would be $25,000 for each workstation. At a MARR of 15%, determine the equivalent annual cost for operating the engineering center.
Click the icon to view the interest factors for discrete compounding when MARR= 15% per year.
C
The equivalent annual cost is $thousand. (Round to the nearest whole number.)
More Info
Worth
Single Payment
Compound Present
Amount
Factor
(F/P, i, N)
1.1500
Compound
Amount
Factor
(F/A, i, N)
Factor
(P/F, i, N)
0.8896
1.0000
1.3225
0.7561
2.1500
1.5209
0.6575
3.4725
0.5718
4.9934
1.7490
2.0114
0.4972
6.7424
0.4323
8.7537
0.3759
11.0688
2.3131
2.6800
3.0590
3.5179
0.3269
13.7268
0.2843
16.7858
4.0456
0.2472
20.3037
SAWNIN
2
3
4
5
67899
10
Equal Payment…
Chapter 17 Solutions
Construction Accounting And Financial Management (4th Edition)
Ch. 17 - What is the do nothing alternative?Ch. 17 - Why is it important to compare all possible...Ch. 17 - What is a sunk cost? How should sunk costs be...Ch. 17 - Prob. 4DQCh. 17 - Prob. 5DQCh. 17 - What is a study period? Why must all of the...Ch. 17 - Why do the NPV, the future worth, and the annual...Ch. 17 - Why must you use mutually exclusive alternatives...Ch. 17 - Why would one use the capital recovery with return...Ch. 17 - What are the weaknesses of the payback period...
Ch. 17 - What types of investments does the payback period...Ch. 17 - What is the advantage of using the project balance...Ch. 17 - A manager has up to 190.000 available to invest in...Ch. 17 - A manager has up to 200,000 available to invest in...Ch. 17 - Determine the MARR for a company that can borrow...Ch. 17 - Determine the MARR for a company that can invest...Ch. 17 - Your company is looking at purchasing a dump truck...Ch. 17 - Your company is looking at purchasing a loader at...Ch. 17 - Your company needs to purchase a new track hoe and...Ch. 17 - Your company needs to purchase a new track hoe and...Ch. 17 - Your company needs to purchase a track hoe and has...Ch. 17 - Your company needs to purchase a truck and has...Ch. 17 - Prob. 23PCh. 17 - Determine the incremental net present value for...Ch. 17 - Determine the future worth for Problem 17. Should...Ch. 17 - Determine the future worth for Problem 18. Should...Ch. 17 - Prob. 27PCh. 17 - Determine the annual equivalent for Problem 18....Ch. 17 - Determine the rate of return for Problem 17....Ch. 17 - Determine the rate of return for Problem 18....Ch. 17 - Your company has 100,000 to invest and has...Ch. 17 - Your company has 200,000 to invest and has...Ch. 17 - Determine the incremental rate of return for...Ch. 17 - Prob. 34PCh. 17 - Your company has purchased a new track hoe for...Ch. 17 - Your company has purchased a new excavator for...Ch. 17 - Determine the payback period without interest for...Ch. 17 - Determine the payback period without interest for...Ch. 17 - Prob. 39PCh. 17 - Determine the payback period with interest for...Ch. 17 - Draw a project balance chart for Problem 17.Ch. 17 - Draw a project balance chart for Problem 18.
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