A small company heats its building and spends $8,000 per year on natural gas for this purpose. Cost increases of natural gas are expected to be 10% per year starting one year from now (i.e., the first cash flow is $8,800 at EOY one). Their maintenance on the gas furnace is $345 per year, and this expense is expected to increase by 15% per year starting one year from now (i.e., the first cash flow for this expense is $396.75 at the EOY one). If the planning horizon is 15 years, what is the total annual equivalent expense for operating and maintaining the furnace? The interest rate is 18% per year. Click the loon to view the interest and annuity table for discrete compounding when/= 10% per year. Click the icon to view the interest and annuity table for discrete compounding when /= 15% per year. Click the icon to view the interest and annuity table for discrete compounding when /= 18% per year. The total annual equivalent expense for operating and maintaining the furnace is $ thousands.…

Process X Is estimated to have a fixed cost of $32,500 per year and a varlable cost of $60 per unit in year 1, decreasing by $5 per unit per year thereafter. Process Y will have a fixed cost of $69,000 per year and a varlable cost of $10 per unit in year 1, Increasing by $1 per unit per year thereafter. At an interest rate of 12% per year, how many units must be produced in year 7 for the two processes to break even? The number of units that must be produced is determined to be 1065

Process X is estimated to have a fixed cost of $40,000 per year and a variable cost of $60 per unit in year 1, decreasing by $5 per unit per year thereafter. Process Y will have a fixed cost of $70,000 per year and a variable cost of $10 per unit in year 1, increasing by $1 per unit per year thereafter. At an interest rate of 12% per year, how many units must be produced in year 3 for the two processes to break even?

An engineer has recently purchased a new piece of equipmenato use in analyzing geological formations. The equipment has no maintenance costs the first year due to a one year's free maintenance warranty. In the second year, it is expected to cost $20 to maintain the equipment and in subsequent years the cost of maintenance will increase by $20 per year (i.e. maintenance cost is $40 in year three, $60 in year four, and so on). Approximately what amount must be set aside now at 6% interest to pay the cost of maintaining the equipment over the first six years of ownership? $289 $206 $254 $229

Tony works for ABC Window Products. While performing an analysis for a new window product, Tony found a report from last year that provided the following information regarding the manufacture of a similar product: annual production rate = 40,000 units; selling price = P70 per unit; fixed production cost = P240,000 per year; variable production cost = P1,700,000 per year; variable selling expenses = P96,000 per year. What is the breakeven production rate per year of the company? Blank 1 units

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A semiautomatic process has fixed costs of $40,000 per year and variable costs of $30 per unit. An automatic process has fixed costs of $88,000 per year and variable costs of $22 per unit. At what production level per year will the two alternatives break even?

A company that manufactures amplified pressure transducers wishes to decide between the machines shown—variable speed (VS) and dual speed (DS). Compare them on the basis of rate of return and determine which should be selected if the MARR = 15% per year. VS DS First cost, $ −250,000 −225,000 AOC, $ per year −231,000 −235,000 Overhaul in year 3, $ — −26,000 Overhaul in year 4, $ −39,000 — Salvage value, $ 50,000 10,000 Life, years 6 6

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