Question: please show all steps and functions on excel please solve for insiders approach only! Principles of Engineering Economic Analysis |(6th Editia : Chapter 11, Problem

please show all steps and functions on excel

please solve for insiders approach only!

please show all steps and functions on excel please solve for insiders

Principles of Engineering Economic Analysis |(6th Editia : Chapter 11, Problem 21P Bookmark Show all steps: O ON Problem Five years ago, ARCHON, a regional architecture/contractor firm, purchased an HVAC unit for $25,000. It is expected to last 10 more years with a net salvage value of $0 at the end of that time. Depreciation over the 5 years has been as MACRS-GDS 7-year property. The annual operating cost of this unit started at $2,000 in the first year and has increased steadily at $250 per year ever since; last year the cost was $3,000. ARCHON has been phenomenally successful due to their reputation for highly functional, high-quality, cost-effective designs and construction. They are building a new wing at their regional headquarters to accommodate a much larger computer design emphasis requiring larger, faster computers, architectural printers, e-storage for a construction repository of previous designs, and an increased human heat load. They can buy an additional unit to air-condition the new wing for $18,000. It will have a service life of 15 years, a net salvage of $0 at that time, and a $3,000 market value after 10 years. It will have annual operating costs of $1,800 in the first year, increasing at $100 per year. As an alternative, ARCHON can buy a new replacement unit to heat and cool the entire building for $35,000. It will last for 15 years and have a net salvage of $0 at that time; however, it will have a market value of $8,500 after 10 years. It will have first-year operating costs of $3,700/year, increasing at $200 per year. The present unit can be sold now for $7,000. The after-tax MARR is 12 percent, the tax rate is 40 percent, and the planning horizon is 10 years. a. Clearly show the cash flow profile for each alternative using a cash flow approach (insider's viewpoint approach). (11.2.2) b. Using a PW analysis and a cash flow approach (insider's viewpoint approach), decide which is the more favorable alternative. (11.2.2) c. Using a PW analysis and a cash flow approach (insider's viewpoint approach), decide which is the more favorable alternative, except note that a Section 1031 like-kind property exchange is to be used. The equipment replaced will continue to be replaced by like-kind investments in the United States indefinitely. (11.4) Principles of Engineering Economic Analysis |(6th Editia : Chapter 11, Problem 21P Bookmark Show all steps: O ON Problem Five years ago, ARCHON, a regional architecture/contractor firm, purchased an HVAC unit for $25,000. It is expected to last 10 more years with a net salvage value of $0 at the end of that time. Depreciation over the 5 years has been as MACRS-GDS 7-year property. The annual operating cost of this unit started at $2,000 in the first year and has increased steadily at $250 per year ever since; last year the cost was $3,000. ARCHON has been phenomenally successful due to their reputation for highly functional, high-quality, cost-effective designs and construction. They are building a new wing at their regional headquarters to accommodate a much larger computer design emphasis requiring larger, faster computers, architectural printers, e-storage for a construction repository of previous designs, and an increased human heat load. They can buy an additional unit to air-condition the new wing for $18,000. It will have a service life of 15 years, a net salvage of $0 at that time, and a $3,000 market value after 10 years. It will have annual operating costs of $1,800 in the first year, increasing at $100 per year. As an alternative, ARCHON can buy a new replacement unit to heat and cool the entire building for $35,000. It will last for 15 years and have a net salvage of $0 at that time; however, it will have a market value of $8,500 after 10 years. It will have first-year operating costs of $3,700/year, increasing at $200 per year. The present unit can be sold now for $7,000. The after-tax MARR is 12 percent, the tax rate is 40 percent, and the planning horizon is 10 years. a. Clearly show the cash flow profile for each alternative using a cash flow approach (insider's viewpoint approach). (11.2.2) b. Using a PW analysis and a cash flow approach (insider's viewpoint approach), decide which is the more favorable alternative. (11.2.2) c. Using a PW analysis and a cash flow approach (insider's viewpoint approach), decide which is the more favorable alternative, except note that a Section 1031 like-kind property exchange is to be used. The equipment replaced will continue to be replaced by like-kind investments in the United States indefinitely. (11.4)

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