18. On 1/1/19, Loyola, Inc. put in a new automated water sensing systems at all of its owned Hospitals to eliminate all handheld watering needed

• Total amount paid for the systems was $50 million and the systems are being depreciated over a 10 year life

• Loyola borrowed the $50 million cost of the facility at an interest rate of 10%. The debt principal was outstanding for all of 2019

• The system resulted in labor cost savings of $5 million during 2019

• The system resulted in water cost savings of $1 million during 2019

• No other impacts other than impacts from the above

What was the impact on EBITDA of Loyola during 2017?

1. No change

2. $1.0 million increase

3. $5.0 million decrease

4. $6.0 million increase

5. None of the above

Answer rating: 100% (QA)

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