Calculate the present worth from the given project summary. Capital Costs = $37,000: Revenue $15,000/year; Operation and Maintenance Costs = $7,100/year; Salvage Value = $17,000; Project Lifetime = 3 years: Effective Interest Rate = 0.03. %3D
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- What is the annual equivalent worth of a project where (a) the initial investment is $50,000; (b) will have revenues of $8,000 per year; (c) annual cost of operation and maintenance of $1,200 and (d) a residual or salvage value of $2,000 after 15 years? Assume rate of return is 8%. A. $-41,200 B. $13,438 C. $6,800 D. $288 E. -$712 F. $3,600Determine the Rate of Return (ROR) for the following project. Initial Capital Investment (P) = $2,942,825 Project Life (n) = 10 years Salvage Value at the end of year 10 $50,000 Equal Annual Revenues = $1,100,000 Equal Annual Operations and Maintenance Costs (AOC) = $400,000 Minimum Acceptable Rate of Return (MARR) = 22% ycy %3D %3D %3D That is the ROR of the project (to the nearest 1%)?Calculate the NPV of a project under consideration with the following information: project life = 5 years; project cost = $1,500,000; unit sales = 25,000; unit price = $200; unit variable cost = $170; fixed costs = $250,000; tax rate = 34%; rate of return = 12%.
- Determine the average rate of return for a project that is estimated to yield total income of $276,080 over 4 years, cost $433,000, and has a $43,000 residual value.? %A project with a life of 10 has an initial fixed asset investment of $25,620, an initial NWC investment of $2,440, and an annual OCF of −$39,040. The fixed asset is fully depreciated over the life of the project and has no salvage value. If the required return is 10 percent, what is the project's equivalent annual cost, or EAC? Show equations using excel.Compute the benefit cost ratio of the following project: Project cost = P80 000 Gross Income = P25000/year %3D Operating Cost = P6000/year Salvage value = 0 Life of project = 10 years %3D Rate of interest = 12%
- A PROJECT IS ESTIMATED TO COST P 100,000.00, LASTS 8 YEARS, AND HAVE A P 10,000.00 SALVAGE VALUE. THEANNUAL GROSS INCOME IS EXPECTED TO AVERAGE P 24,000.00 AND ANNUAL EXPENSES, EXCLUDINGDEPRECIATION, WILL TOTAL P 6,000.00. IF CAPITAL IS EARNING 10% BEFORE INCOME TAXES, DETERMINE IFTHIS IS A DESIRABLE INVESTMENT USING:A.) RATE-OF-RETURN METHODB.) ANNUAL COST METHODC.) PRESENT-WORTH COST METHODDetermine the average rate of return for a project that is estimated to yield total income of $484,440 over 4 years, costs $668,000, and has a $66,000 residual value.1. Determine the B/C ratio for the following project. First Cost P100, 000 Project life, years 5 Salvage value P10, 000 Annual benefits P60, 000 Annual O and M P22, 000 Interest rate, % 15 Ans: B/C = 1.16
- Determine the average rate of return for a project that is estimated to yield total income of $269,760 over four years, cost $511,000, and has a $51,000 residual value. fill in the blank %A piece of equipment has an initial cost of $125,000. The annual 0&M costs are $31,000 and increase $1000 per year. The annual revenue is $45,000 and increase $1,500 per year. The equipment has a life span of 8 years and a salvage value of $30,000. Based on a MARR of 5%, determine the following: a. If the project is viable based on Net Present Worth. b. Determine the amount the annual revenue has to be increased to make the project viable. c. Determine the amount the salvage value has to increase to make the project viable.Determine the B/C ratio for the following project. First Cost P100, 000 Project life, years 5 Salvage value P10, 000 Annual benefits Р60, 000 Annual O and M Р22, 000 Interest rate, % 15