Hello, can you help with this question, please use the excel file template as the solution, thanks

Economic Benefit Analysis

Objective: This project provides you with an opportunity to use spreadsheet software to use the NPV technique to analyze the return on an investment for a computer-aided design (CAD) system.

Case Background:

My company would like to invest in a new CAD system that requires purchasing hardware, software, and networking technology, as well as expenditures for installation, training, and support. Management has provided your team some tables showing each cost component for the new system as well as annual maintenance costs over a five-year period. Using the data provided in these tables, create a worksheet that calculates the costs and benefits of the investment over a five-year period. Use the worksheet to calculate the following

1. NPV of all benefits and costs (assume a discount rate of 5%).
2. Overall NPV
3. Return on investment

What is CAD system? The full name of CAD system is Computer-aided Design (CAD) system. It is the use of computer systems to assist in the creation, modification, analysis, or optimization of a design. The rationale of my companys management to establish this system is to replace our labor force by computerization in the daily operation. By doing this, our company can reduce labor costs, and increase the gross profits as the final goal.

Objectives of our Company to Establish the new CAD System:

The system is expected to be completed at the end of year 0 (2020). From 2021 to 2025, the new system is expected to reduce labor costs by $250,000 per year and to increase gross revenue $150,000 per year. The following Tables 1 and 2 show each cost component for the new CAD system as well as annual maintenance costs over a five-year period.

Table 1 CAD System Components Year 0 Costs
Item	Quantity	Cost/each
Hardware
PCs	50	$1,700
Network Cards	50	$50
Servers	2	$3,000
Color Laser Printers	3	$5,500
Color Laser Plotters	2	$3,100
Telecommunications
Backup Unit	1	$1,200
Cabling w/plugs	2,000 feet	$0.75/foot
Routers w/Firewall	2	$500
Switches	2	$700
Telephone Connection Costs	-----	$5,000
Software
CAD Software	50 licenses	$3,500/license
Database	50 licenses	$80
Network	50 licenses	$70
Office Software	50 licenses	$250/license
Services
In-house Trainer	1	$50,000
AutoCAD Training	50 hours	$75/hour
In-house Systems Personnel	1	$75,000

Table 2 Estimated Annual Maintenance Costs
	2021	2022	2023	2024	2025
PCs	$5,000	$5,000	$5,000	$5,000	$5,000
Network cards	$500	$500	$500	$500	$500
Servers	$1,000	$1,000	$1,000	$1,000	$1,000
Color laser printers	$500	$500	$500	$500	$500
Plotters	$500	$500	$500	$500	$500
Tape Backup	$500	$500	$500	$500	$500
Cabling w/plugs (in feet)	$100	$100	$100	$100	$100
Routers w/firewall	$100	$100	$100	$100	$100
Switches	$100	$100	$100	$100	$100
Telephone connection costs	$1,000	$1,000	$1,000	$1,000	$1,000
CAD software	$1,000	$1,000	$1,000	$1,000	$1,000
Database	$500	$500	$500	$500	$500
Network	$500	$500	$500	$500	$500
Office software	$1,000	$1,000	$1,000	$1,000	$1,000
In-house trainer	$40,000	$30,000	$20,000	$10,000	$10,000
AutoCAD training	$1,000	$1,000	$1,000	$1,000	$1,000
In-House systems personnel	$75,000	$76,000	$77,000	$79,000	$82,000

Solution template:

	Years of Project
	Year 2020	Year 2021	Year 2022	Year 2023	Year 2024	Year 2025	TOTALS
Net economic benefit
Discount rate
Present Value of Benefits
Net Present Value of all Benefits								2.5 points
One-time COSTS
Discount rate
Recurring Costs
Present Value of Recurring Costs
Net Present Value of all Costs								2.5 points
Overall Net Present Value								2.5 points
Overall Return on Investment								2.5 points
								10 points