Washington County's Board of Representatives is considering the construction of a longer runway at the county...
Fantastic news! We've Found the answer you've been seeking!
Question:
![image text in transcribed](https://s3.amazonaws.com/si.experts.images/answers/2024/05/6648634b24478_0426648634a938d6.jpg)
![image text in transcribed](https://s3.amazonaws.com/si.experts.images/answers/2024/05/6648634bbb916_0436648634b5b18b.jpg)
![image text in transcribed](https://s3.amazonaws.com/si.experts.images/answers/2024/05/6648634c4426d_0436648634be1623.jpg)
Transcribed Image Text:
Washington County's Board of Representatives is considering the construction of a longer runway at the county airport. Currently, the airport can handle only private aircraft and small commuter jets. A new, long runway would enable the airport to handle the midsize jets used on many domestic flights. Data pertinent to the board's decision appear below. Cost of acquiring additional land for runway Cost of runway construction Cost of extending perimeter fence Cost of runway lights Annual cost of maintaining new runway Annual incremental revenue from landing fees $ 76,500 219,610 31,855 42,850 30,600 43,640 In addition to the preceding data, two other facts are relevant to the decision. First, a longer runway will require a new snowplow, which will cost $113,000. The old snowplow could be sold now for $10,650. The new, larger plow will cost $13,300 more in annual operating costs. Second, the County Board of Representatives believes that the proposed long runway, and the major jet service it will bring to the county, will increase economic activity in the community. The board projects that the increased economic activity will result in $77,260 per year in additional tax revenue for the county. In analyzing the runway proposal, the board has decided to use a 10-year time horizon. The coubty's hurdle rate for capital projects is 12 percent. Required 1 Required 2 Required 3 Prepare a net-present-value analysis of the proposed long runway. Note: Round your "Annuity discount factor" to 3 decimal places. Amounts to be deducted should be indi Annual incremental benefit Annuity discount factor Present value of annual benefits Initial costs: Net present value $ 0 Required 1 Required 2 Required 3 Should the County Board of Representatives approve the runway considering NPV? Should it approve the runway considering NPV? < Required 1 Required 3 > Washington County's Board of Representatives is considering the construction of a longer runway at the county airport. Currently, the airport can handle only private aircraft and small commuter jets. A new, long runway would enable the airport to handle the midsize jets used on many domestic flights. Data pertinent to the board's decision appear below. Cost of acquiring additional land for runway Cost of runway construction Cost of extending perimeter fence Cost of runway lights Annual cost of maintaining new runway Annual incremental revenue from landing fees $ 76,500 219,610 31,855 42,850 30,600 43,640 In addition to the preceding data, two other facts are relevant to the decision. First, a longer runway will require a new snowplow, which will cost $113,000. The old snowplow could be sold now for $10,650. The new, larger plow will cost $13,300 more in annual operating costs. Second, the County Board of Representatives believes that the proposed long runway, and the major jet service it will bring to the county, will increase economic activity in the community. The board projects that the increased economic activity will result in $77,260 per year in additional tax revenue for the county. In analyzing the runway proposal, the board has decided to use a 10-year time horizon. The coubty's hurdle rate for capital projects is 12 percent. Required 1 Required 2 Required 3 Prepare a net-present-value analysis of the proposed long runway. Note: Round your "Annuity discount factor" to 3 decimal places. Amounts to be deducted should be indi Annual incremental benefit Annuity discount factor Present value of annual benefits Initial costs: Net present value $ 0 Required 1 Required 2 Required 3 Should the County Board of Representatives approve the runway considering NPV? Should it approve the runway considering NPV? < Required 1 Required 3 >
Expert Answer:
Posted Date:
Students also viewed these accounting questions
-
1. Describe briefly how computers work and become tools for committing cyber-related crimes. 2. Use of proxies and VPNs is one of the methods cybercriminals try to cover their digital track and...
-
Continuing with the preceding question, note that the monetary value of output in 1985 was$4,010billion in the United States and 1,418 billion cruzados in Brazil. Refer back to question 3 and...
-
Raiders plc prepares accounts annually to 31 March. The following figures, prepared on a conventional historical cost basis, are included in the companys accounts to 31 March 20X5. 1 In the income...
-
Explain (a) depositor insurance, (b) lender of last resort, (c) systemically important financial institution.
-
Firemaster BBQ produces stainless steel propane gas grills. The company has been in operation for three years, and sales have declined each year due to increased competition. The following...
-
In 2023, Lola and Lonnie are married and reported the following items of income at the end of the tax year: For Lola, salary of $117,000, interest income of $1000. For Lonnie, salary of 100,000,...
-
Accounts receivable is categorized as a(n) O current liability O immovable asset O current asset O depreciated liability
-
What factors can be used to control audit risk?
-
What two methods can be used to measure variation in a population?
-
Explain how the auditor might determine tolerable error.
-
If other factors are held constant, what happens to the sample size of substantive tests of details (becomes larger or smaller) when a. Reliance on the internal control structure increases? b....
-
Over what period can a tax loss be used as an offset against taxable income?
-
Hank rented a new ground-floor condominium for four months before the owner offered to sell it to him. Hank accepted the offer. After Hank became the owner, he built a small patio off the living...
-
The Home Depot is the leading retailer in the home improvement industry and one of the 10largest retailers in the United States. The company included the following on its January 29, 2012, balance...
-
Paulson Manufacturing Company uses the perpetual inventory system to account for its manufacturing inventories. The following are Paulsons transactions during July 2019: July 5 Received materials...
-
The following amounts are available for 2019 for Bishop Manufacturing Company: Required Using the above data, prepare a schedule of cost of goods manufactured and sold. Administrative salaries...
-
You are consulted by Investors, Inc., a group of investors planning a new product. They have estimates of the costs of materials, labor, overhead, and other expenses for 2019 but need to know how...
![Mobile App Logo](https://dsd5zvtm8ll6.cloudfront.net/includes/images/mobile/finalLogo.png)
Study smarter with the SolutionInn App