Two mutually exclusive public projects are currently under consideration. Each of the project has a useful...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Two mutually exclusive public projects are currently under consideration. Each of the project has a useful life of 30 years and MARR 10%. The district official meetings has to decide on proceeding only one of the project. Project A has an initial cost of RM150,000 with RM35,000 annual operating and maintenance cost. In its first year of operation, RM100,000 revenues is anticipated followed by annual profit of RM50,000 per year. At the end of the project, the market value would be RM75,000. Project B on the other hand offers RM70,000 revenues per year with initial cost of RM300,000. Its annual operating cost is RM50,000 per year and the market value of the project will be RM30,000 at the end of its useful years. Which, if any, of these projects should be selected? Include your justification. Two mutually exclusive public projects are currently under consideration. Each of the project has a useful life of 30 years and MARR 10%. The district official meetings has to decide on proceeding only one of the project. Project A has an initial cost of RM150,000 with RM35,000 annual operating and maintenance cost. In its first year of operation, RM100,000 revenues is anticipated followed by annual profit of RM50,000 per year. At the end of the project, the market value would be RM75,000. Project B on the other hand offers RM70,000 revenues per year with initial cost of RM300,000. Its annual operating cost is RM50,000 per year and the market value of the project will be RM30,000 at the end of its useful years. Which, if any, of these projects should be selected? Include your justification.
Expert Answer:
Related Book For
Engineering Economy
ISBN: 978-0132554909
15th edition
Authors: William G. Sullivan, Elin M. Wicks, C. Patrick Koelling
Posted Date:
Students also viewed these accounting questions
-
How long it will take an investment that has a return of 8% per year to double five times in value? Select one: 20.9 years 14.27 years 18 years 9 years
-
As the financial advisor to All-Star Manufacturing you are evaluating the following new investment in a manufacturing project: The project has a useful life of 12 years. Land costs $6m and is...
-
For the following transactions, state the accounts to be debited and credited. a) Firm buys inventory and pays immediately by cheque. b) Goods returned to the original supplier, A Rahman, due to them...
-
Detail how the respond to the following scenarios, with one agreeing or acknowledging the critic, and one seeking more information: "You are so lazy" {Husband says to his wife when she refuses to get...
-
A study of hunting injuries and the wearing of hunter orange clothing showed that among 123 hunters injured when mistaken for game, 6 were wearing orange (based on data from the Centers for Disease...
-
Let H be the hemisphere x 2 + y 2 + z 2 = 50, z > 0, and suppose f is a continuous function with f (3, 4, 5) = 7, f (3, -4, 5) = 8, f (-3, 4, 5) = 9, and f (-3, -4, 5) = 12. By dividing H into four...
-
Assume that \(\$ 4,000\) cash is borrowed on a \(\$ 4,000,10 \%\), one-year note payable that is interest-bearing and that another \(\$ 4,000\) cash is borrowed on a \(\$ 4,400\) one-year note that...
-
Norton Company reports the following operating results for the month of August: Sales $310,000 (units 5,000); Variable costs $210,000; And fixed costs $75,000 Management is considering the following...
-
Discussion Question 11-33 (parts a, b and c only) on page 364 of the textbook (20 marks) 11-33 3 4 9 The following is a partial audit program for the audit of cash receipts: 1. Review the cash ...
-
Amanda Autry and Carley Wilson are partners in A & W Gift Shop, which employs the individuals listed below. Paychecks are distributed every Friday to all employees. Based on the information given,...
-
An epicyclic gear train is shown in Figure 1. Arm A and sun gear B are fixed to coaxial shafts SA and SB respectively. Two planet gears C and D are mounted firmly to the same shaft, rotating together...
-
The total factory overhead for Cypress Marine Company is budgeted for the year at $582,000, divided into two departments: Fabrication, $360,000, and Assembly, $222,000. Cypress Marine manufactures...
-
Using the Internet, find an advertisement or other promotion that resulted in miscommunication. Describe what caused the miscommunication and how the business handled it.
-
1. Describe how conflict management competent support effective management and professional development of direct reports. 2. Describe how people management competent support effective management and...
-
What is the output of given code block? number1 = 20; number2 = 10; number3 = 50 if number 1 > number2 print("What") elif number 1 * 2.5 = = number3 print("an easy") else number2
-
Calculate the following from The data given below A 1 Multinational Financial Management 2 3 Exchange rates of currencies, relative to the U.S. dollar 4 5 British pound 6 EMU euro 7 Japanese yen 8...
-
Your Boss would like the following deliverables: A Project Plan (Write up and AON charts) Project Summary SMART - Goals/Objectives Statement of Work Scope Statement WBS Determine Supplier You wil...
-
In the busy port of Chennai, India, the number of containers loaded onto ships during a 15-week period is as follows: 1. Develop a linear trend equation to forecast container loadings. 2. Using the...
-
One component of a system's life-cycle cost is the cost of system failure. Failure costs can be reduced by designing a more reliable system. A simplified expression for system life-cycle cost, C, can...
-
Develop a spreadsheet to verify that the following table entries are correct (to the nearest whole percent). Erosion of Money's Purchasing Power Inflation Rate 10 years 25 years 2% 4% -18% -32% -39%...
-
The PW of the ATCFs through year k, FWk, for a defender (three-year remaining useful life) and a challenger (five-year useful life) are given in the following table: Assume the after-tax MARR is 12%...
-
3. During the course of 10 months, Joseph Melle sent more than 60 million unsolicited e-mail advertisements to AOL members. What charges could be brought against him?
-
6. Craig Hare offered computers and related equipment for sale on various Internet auction Web sites. He accepted payment but not responsibility-he never shipped the goods. Both the FTC and the U.S....
-
5. What can you do to protect your privacy online? Draw up a concrete list of steps that you might reasonably consider. Are there some actions that you would not be willing to take, either because...
Study smarter with the SolutionInn App