Feasibility Study for a New

Software Project

Your CEO has asked you as a systems analyst to conduct a feasibility study

for a new software project that will help reduce costs, reduce errors, improve

overall flexibility, provide an ease of interacting with business partners,

increase the speed of transaction activity, and improve overall management

planning control. You have received the following data regarding the

tangible benefits and associated costs for this proposed project:Total Tangible Benefits $$60,000$

One Time Cost $($Initial

Investment$)$:

Development Costs $$2,000$

New Hardware $,$$$1,000$

Software License or

Purchase cost

$$19,500$

User Training

$$3,500$

Site Preparation

$$4,000$

Total One Time Cost

$$30,000$Recurring Cost

$($Yearly$)$:

Software Maintenance $$2,500$

Incremental Data

Storage

$$2,500$

Communications $$9,000$

Supplies

$$7,000$

Other

$$4,000$

Total Recurring Cost

$$25,000$Step $1$

You are to conduct an economic benefit review by performing a cost benefit

analysis by calculating the Net Present Value $($NPV$),$ Return on Investment

$($ROI$),$ and Break$-$Even Point $($BEP$).$ The company wants to consider the time

value of money when performing these calculations. The discount rate

utilized for investments is $12$ percent. You will utilize the Cost Benefit

Analysis Template in MS Excel to complete these calculations. Please save

your work on this Excel file.