For each of the following problems, (a) draw the cash flow diagram; (b) present clean and clear manual solutions to the problem; (c) highlight the final answer (only the final answer as required by the problem) by enclosing it within a box. Company E is considering installing Valutemp temperature loggers in all of its refrigerated trucks for monitoring temperatures during transit. If the systems will reduce insurance claims by $500,000 in each of the next 5 years, how much should the company be willing to spend now if it uses an interest rate of 10% per year?
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For each of the following problems, (a) draw the cash flow diagram; (b) present clean and clear manual solutions to the problem; (c) highlight the final answer (only the final answer as required by the problem) by enclosing it within a box.
Company E is considering installing Valutemp temperature loggers in all of its refrigerated trucks for monitoring temperatures during transit. If the systems will reduce insurance claims by $500,000 in each of the next 5 years, how much should the company be willing to spend now if it uses an interest rate of 10% per year?
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- For following problem, (a) draw the cash flow diagram; (b) present clean and clear manual solutions to the problem; (c) highlight the final answer (only the final answer as required by the problem) by enclosing it within a box. A new air conditioning system is to be installed in an office building. Purchasing and installing the system costs $100,000 and the company expects to save $50,000 every year on electricity bills. The company’s MARR is 10% per year, maintenance costs are worked out to be $10,000 per year and the system’s market value will be $20,000 at the end of 10 years. Use the FW method to determine whether the system should be installed.For each of the following problems, (a) draw the cash flow diagram; (b) present clean and clear manual solutions to the problem; (c) highlight the final answer (only the final answer as required by the problem) by enclosing it within a box. An Army Corps of Engineers project for improving navigation will have an initial cost of $6,500,000 and annual maintenance of $120,000. Benefits for barges and paddle wheel touring boats are estimated at $800,000 per year. The project is assumed to have a discount rate of 10% per year. Use conventional B/C analysis to determine if the Corps should proceed with the project.The production department is proposing the purchase of an automatic insertion machine. It has identified three machines and has asked the accountant to analyze them to determine which one has the best cash payback. Machine A Machine B Machine C Annual cash flow $40,000 $50,000 $75,000 Average investment 300,000 250,000 500,000 a.Machine A b.Machine C c.Machine B d.Machines B and C have the same preferred payback period.
- For each of the following problems, (a) draw the cash flow diagram (as needed); (b) present clean and clear manual solutions to the problem; (c) highlight the final answer (only the final answer as required by the problem) by enclosing it within a box. A process for producing the mosquito repellant Deet has an initial investment of $20,000 with annual costs of $51,000. Income is expected to be $90,000 per year. What is the simple payback period? What is the compounded payback period at an interest rate of 12%? no excel and round two decimal places as requiredPlease write the CBA analysis for these two options Option A requires the purchase of a garbage collection vehicle that needs a two-person crew. The vehicle will cost $60,000 and each worker will be paid $20,000 a year. The city would pick up 400 tons of garbage annually, and for each ton of garbage collected, it would charge a $400 fee. The city would have annual revenue of $160,000 (400 × $400) from this operation. +Please fill in the correct answer in each blank provided below. Project A. NPV Present value of Benefits Present value of CostsA grocery distribution center is considering whether to invest in RFID or bar code technology to track its inventory within the warehouse and truck loading operations. The useful life of the RFID and bar code devices is projected to be 5 years with minimal or zero salvage value. The bar code investment cost is $105,000 and can be expected to save at least $33,000 in product theft and lost items annually. The RFID system is estimated to cost $230,000 and will save $30,000 the first year, with an increase of $15,000 annually after the first year. For a 6% MARR, should the manager invest in the RFID system or the bar code system? Analyze incrementally using rate of return.
- For each of the following problems, (a) draw the cash flow diagram; (b) present clean and clear manual solutions to the problem; (c) highlight the final answer (only the final answer as required by the problem) by enclosing it within a box. Several alternatives are under consideration to enhance security at a county jail. These alternatives are mutually exclusive. Determine which should be selected based on modified B/C analysis using an interest rate of 8% per year and a 12-year study period. Extra Cameras New Sensors Steel Tubing Access Control First Cost, $ 38,000 87,000 99,000 61,000 Maintenance Costs, $/y 49,000 64,000 42,000 38,000 Benefits, $/y 110,000 160,000 74,000 52,000 Disbenefits, $/y 26,000 21,000 32,000 14,000Metropolitan Water Utility is planning to upgrade its SCADA system for controlling well pumps, booster pumps, and disinfection equipment so that everything can be controlled from one site. The first phase will reduce labor and travel costs by an estimated $31,000 per year. The second phase will reduce costs by an estimated $20,000 per year. If phase I will occur in years 1 through 3 and phase II in years 4 through 8, what is (a) the present worth of the savings, and (b) the equivalent annual worth for years 1 through 8 of the savings? Use an interest rate of 8% per year. Solve using tabulated factors and a spreadsheet.CBA analysis for these two options Option A requires the purchase of a garbage collection vehicle that needs a two-person crew. The vehicle will cost $60,000 and each worker will be paid $20,000 a year. The city would pick up 400 tons of garbage annually, and for each ton of garbage collected, it would charge a $400 fee. The city would have annual revenue of $160,000 (400 × $400) from this operation. Option B requires a vehicle for a three-person crew. The vehicle will cost $80,000 and each worker will be paid $15,000 annually. With this option, the city’s garbage collection capacity would be 300 tons annually, so the annual revenue would be $120,000 (300 × $400). Using a three-year period and a discount rate of 5 percent, which option should be recommended in the budget request?
- Angelus Press is considering replacing all of its old cash registers with new ones. The old registers are fully depreciated and have no disposal value and will be sold for $ $50,000. The new registers cost $ 680,000. Because the new registers are more efficient than the old registers, Angelus Press will have annual cost savings from using the new registers in the amount of $140,000, for the first four years and then $ 100,000 for the remaining two years. The registers have a 6-year useful ife, and are depreciated using the straight line method with no disposal value. Angelus Press require a 12% real rate of return. Ignore income taxes Required: Calculate the Net present value and based on your answer state if project should a) be accepted Calculate the Payback period and based on your answer state if project should b) be accepted Calculate the Internal Rate of return and based on your answer state if project should be accepted c) Calculate the Accrual Rate of Return and based on your…A small town in Ohio is considering the purchase of a new parking system that would enhance the collection of parking fees while providing additional convenience to shoppers. The hardware requires an immediate investment of $950. The town estimates that the new system will create an annual cash flow of $204 to be received at the end of each year, beginning in one year, for 7 consecutive years. And, in addition, the project will produce a terminal cash flow in year 8 of $304. What is the payback, in years, of the computer package?YearsPlace your answer in number of years, as an integer (whole number)Your answer is incorrect. The Management of Sandhill Manufacturing Company is evaluating two forklift systems to use in its plant that produces the towers for a windmill power farm. The costs and the cash flows from these systems are shown below. The company uses a 9 percent discount rate for all projects. Otis Forklifts Craigmore Forklifts Otis forklift Craigmore Forklifts Otis forklift Year 0 Craigmore Forklifts $-3,110,450 $-4,138,410 NPV $551,814 $350,223 Year 1 IRR $964,225 $1,352,886 $861,236 $1,748,225 Compute the IRR for each of the two systems. (Round intermediate calculation to O decimal places, e.g. 1,525 and final answers to 2 decimal places, e.g. 15.10%.) Year 2 % % Year 3 $2,122,497 $2,884,110