Hartz Company is looking to start a CSR program involving installing solar panels on the roof of the building. Information on the investment is as follows:

Initial Cost of Project: $150,000

Estimated Savings Per Year 20,000

Variable Cost Per Year 5,000

Estimated Life of Project 20 years

Required

What are the net savings per year?

What are the net savings over the life of the project?

What is the estimated payback time in years? (round to two decimals)

Should the project be started? Explain your answer with amounts.

Questions	Answers
What are the net savings per year?
What are the net savings over the life of the project?
What is the estimated payback time?

Should the project be started? Support your answer with amounts.

All of these amounts ignore the time value of money. What does that mean? What is not included in these calculations that could cause the final decision to be different (from a financial standpoint)?

What is your opinion of corporate social responsibility (CSR)? Look at your answers to #6. (your conclusion should have been positive). If the project were to show a negative net income, do you think they company should still invest the money? Does the amount of loss change your answer? How much of a loss would be acceptable to start the CSR project?

Answer rating: 100% (QA)

Step 11 1 Calculation of net saving per year Estimated savings per yearvariable cost ... View the full answer