Fonderia di Torino S.P.A. Case Study

Item 4. Facilities Upgrade and Production Manning In order to meet customer demands for higher product quality, to comply with federally-mandated environmental regulations, and to reduce production costs, HCC must spend $2,000,000 within the next three years to upgrade equipment. The upgrade is expected to result in production efficiencies that will lower material and labor costs by reducing defective products, process waste, in-process inventory, and production man-hours through simplified work processes. It has been over a decade since significant modifications were made to the production facilities. Those changes were mostly technical in nature and did not substantially alter work processes or reduce overall employment. The average productivity gain in the industry for the past five years has been 3% per year. Financing for the loan to purchase the equipment

ML had developed a policy of selling manual machines and renting automatic machines. Manual machines did not cost much, did not require service, and could be modified to attach different fasteners inexpensively. Automatic machines were rented on an annual basis because they would have been more expensive to sell and it provided annual income to ML. However, about 700 of the rented machines were returned each year. During the time that machines were in inventory, ML would modify the machines to attach different fasteners. This was expensive with an average cost per modification of $2000. If all 700 machines were modified during a given year this would have cost $1.4 million per year. It was also industry practice to provide preventative maintenance and

When making a purchase to improve on many areas of operations there are always factors to take into consideration. There will be a great amount of capital expenditure for this equipment; however the potential for higher return on investment is remarkable. The initial cost of purchasing the MAGNETOM is approximately $ 1 million. There will be an additional cost of $500,000 to operate and maintain the machine. These costs will be reimbursed within the first eight months of extensive utilization if the all marketing for the machine is on point. Since we are currently paying a technician to operate our out of date machinery, there is no reason why this prediction cannot become reality. There will also be an offset of income inherited by the lack of errors made by the technicians after they have trained for the new machine . ("Magnetom espree -," 2013)

Rm – Rf = 6.45%. We will estimate beta equity using data of comparable firms, focusing on We assumed that the cost of graphite which according to exhibit 8 has been growing slower year on year would grow steadily at 4% and that power costs would grow at 12% per year up to 1989. We also assumed that the benefits of laminate technology will only be felt starting in 1981. With 1980 as the base year, the NPV calculation was done as at December, 1980 and we assumed that the cash injection of $2.5million dollars would occur instantaneously in December 1980. Using a median assumption of power cost savings of 17.5%, we arrive at an NPV of $12.865million for the laminate investment. The applicable range and full calculations are presented below.

Phase II: Funding Options for Equipment Acquisition Due to the technological advances in the medical industry, the clinic has decided on advanced medical equipment to provide quality care to the patients. The equipment that will be purchased is a High- Speed CT Scanner, X-Ray Machine, and an Ultrasound Machine. This equipment will allow more quick and efficient test and treatment. The options that can be made include: buying new or refurbished equipment with an option of a loan, acquiring on capital or operating lease. During this phase, I chose the most cost effective option to acquire the equipment. To acquire the equipment, I chose the operating lease. Since there are always potential advances in technology, buying the equipment may not be a good idea. In the long term, the equipment that was purchased will likely be replaced by newer technology in a few years. Due to the decisions of acquiring new equipment, the clinic is now doing well and the profits are growing which allowed growth for the clinic.

Q3. Do you agree with Mr. Clarkson’s estimation of the company loan requirements? How much will he need to finance the expected expansion in sales to $ 5.5 Mil. In 1996 and to take all trade discounts?

 Case Study: TEMKO Earthmovers Presented to Mr. Willy Cuason Decision Sciences and Innovation Department De La Salle University- Manila In Partial Fulfillment of the Requirements for SUPPMAN (M71) Submitted by: Chu, Hyemin Cruz, Charleen Grace Lim, Nicolai Tamayo, Glaiza May Submitted on: June 2, 2015 Table of Contents I. Case Background …………………………………………………………………………...2 II. Summary of Findings ……………………………………………………………………….2 III. Statement of the Problem …………………………………………………………………3 IV. Analysis of Alternatives …………………………………………………………………...3 V.

PFF Outcome 4 – Project Appraisal Nadezda Valeckova Report: Project Appraisal To: Management of Matteck plc Prepared by: Nadezda Valeckova Date: 20/01/2015 Introduction I have been asked to produce a report for management of Matteck plc in which I will evaluate the financial viability of the investment proposal. The company is considering expanding into Asia. This operation would involve the acquisition of a factory, a purchase of several new motor vehicles and a new distribution unit. The following are the estimated costs of the planned investment:

Fonderia di Torino, S.p.A Midterm Individual Case Fonderia di Torino, S.p.A is a manufacturing company who produces metal castings using six semi-automated molding machines. However, they are currently considering purchasing a Vulcan Mold-Maker machine to replace the six machines currently in place. The firm needs to consider all costs in deciding whether to keep the current machines or purchase the Vulcan Mold-Maker.

There are three potential sources (JabaKing, Merakuri and Pnutype) available to Platinum for the equipment that will replace the aging presses currently in use. Several key factors need to be considered when making this decision not least of which is the overall cost of acquiring the new equipment. To this end, a Total Cost Analysis (Exhibit A) evaluation of the suppliers has been employed to fully assess the available alternatives, and to make the subsequent recommendations on supplier to choice. Direction given by Jim Hicza, has made in clear that cost considerations will be a primary concern.

BERGERAC CASE STUDY Summary The purpose of this report is to analyze the opportunity to produce plastic components for cartridge production and choose the best alternative. It is predicted that the annual demand growth is a triangular distribution with a minimum of 5%, most likely of 17% and a maximum of 25%.

Given the insignificant initial investment of $7,500 to manufacture plastic rings, he should be concerned that this new innovation will increase profits short-term but eventually lead to a loss of 480% ($242.1 / $50.37) long-term after other competitors produce the part.

Payback period = $4,000,000 $ 500,000 = 8 years ~ Advantages of payback: - It is simplicity - In a business environment of rapid technological change, new plant and machinery may need to be replaced sooner than in the past, so a quick payback on investment is

Recommendation Report Khalid Abdulwahab, ENGT 3318 Research and Reporting Barbier Brigitte Table of content Title page P1 Table of content P2 Abstract P3 Introduction P3 Mythology & Results P3-8 Decition and conclution P8-9 Citation P10 Abstract A company must whether make or buy a part. The company is capable of making it but needs the same machine used to make this part

Financial analysis of a new project Introduction The following paper analyzes a project from financial perspectives using the capital budgeting techniques like Net Present Value (NPV) and Internal Rate of Return (IRR). Background My dad has a textile business, involved in embroidery and painting of the fabric. I have been visiting my dad’s