Question: The initial cost for a process upgrade was $42,000. It is expected to cost $3000 in year one, $4500 cost in years four and five,

The initial cost for a process upgrade was $42,000. It is expected to cost $3000 in year one, $4500 cost in years four and five, and $900 in years six through nine. The salvage value was $70,000 in year nine. a. Draw the cash flow diagram and equation for the Ballpark method. (10) b. Write the equation for the actual problem and determine the ROR using the trial and error method as outlined in the text. (This requires a completely manual solution. If you use some other method such as Excel, no points will be given). (30) The initial cost for a process upgrade was $42,000. It is expected to cost $3000 in year one, $4500 cost in years four and five, and $900 in years six through nine. The salvage value was $70,000 in year nine. a. Draw the cash flow diagram and equation for the Ballpark method. (10) b. Write the equation for the actual problem and determine the ROR using the trial and error method as outlined in the text. (This requires a completely manual solution. If you use some other method such as Excel, no points will be given). (30)
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
