A 250 square foot shell and tube heat exchanger was purchased for $15,250 in 2004 when the index value was 830. Estimate the cost of 150 square foot shell and tube heat exchanger in 2014 when the index value is 1,059 and the appropriate cost-capacity factor is 0.6.
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A 250 square foot shell and tube heat exchanger was purchased for $15,250 in 2004 when the index value was 830. Estimate the cost of 150 square foot shell and tube heat exchanger in 2014 when the index value is 1,059 and the appropriate cost-capacity factor is 0.6.
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- The table given below lists the relevant cost items for a specific system purchase. The operating expenses for the new system are $10,000 per year, and the useful life of the system is expected to be five years. The salvage value for depreciation purposes is equal to 25% of the hardware cost. Cost Item Cost Hardware $160,000 Training $15,000 Installation $15,000 a) What is the Book Value (BV) of the device at the end of year three if the Straight Line (SL) depreciation method is used? b) Suppose that after depreciating the device for two years with the SL method, the firm decides to switch to the double declining balance depreciation method for the remainder of the device's life (the remaining three years). What is the device's BV at the end of four years?A small utility company is considering the purchase of a powerdriven post hole digger. The equipment will cost $8,000 and have an estimated life of 8 years and a salvage value of $1,000 at that time. Annual maintenance costs for the digger are estimated to be 15% of the first cost regardless of its level of usage. Operations costs are $40 per day with an output rate of 25 holes per day. At present, holes are manually dug at a rate of 1.5 per day by a laborer whose marginal cost is $11.20 per day. Determine the break-even value in holes per year. MARR is 8%.A conveyor system was purchased three years ago for $60,000 with an expected useful life of 10 years and no expected salvage value. Due to a change in product configuration, the conveyor system must be upgraded at a cost of $20,000. Maintenance on this system is approximately $4000 per year and the current system has a market value of $2000. Alternatively, the current system can be replaced with new equipment costing $65,000, with operating costs of $1,000 per year and an expected salvage of $10,000 after 7 years. Determine whether the company should keep or replace the defender now at an MARR of 15% per year. The current system is the Defender and the new system is the Challenger. What is the annual worth of the challenger?
- A 250-gallon reactor cost $780,000 when it was constructed 20 years ago. What would a 750-gallon model cost today if the power-sizing exponent is 0.56 and the construction cost index for such facilities has increased from 141 to 556 over the last 20 years? Choose the closest value. (a) $0.37 million (b) $1.66 million (c) $1.44 million (d) $5.69 millionA coal-fired power plant has upgraded an emission control valve. The modification costs only $ 8,000 and is expected to last 6 years with a $200 salvage value. The maintenance cost is expected to be high at $ 1,700 the first year, increasing by 11% per year thereafter. What are the equivalent present worth of the modification and maintenance cost if money is worth 8% per year.Eight years ago, the Blank Block Building Company installed an automated conveyor system for $38,000. When the conveyor is replaced, the net cost of removal will be $2500. The minimum EUAC of a new conveyor is $6500. When should the conveyor be replaced if BBB’s MARR is 12%? The O&M costs for the next 5 years are $5K, $6K, $7K, $8K, and $9K.
- Give typing answer with explanation and conclusion A new production system for a factory is to be purchased and installed for $154982. This system will save approximately 300,000 kWh of electric power each year for a 6-year period. Assume the cost of electricity is $0.10 per kWh, and factory MARR is 15% per year, and the salvage value of the system will be $9668 at year 6. Using the PW method to analyzes if this investment is economically justified A- calculate the PW of the above investment and insert the result below.The cost characteristics of a CO testing machine that was purchased 5 years ago for $100,000 are shown below. The equation to determine the AW of retaining the tester one more year and then replacing it is: (a) AW = −15,000(A/P,i,1) − 54,000 + 10,000(A/F,i,1) (b) AW = −100,000(A/P,i,6) − 54,000 + 10,000(A/F,i,6) (c) AW = −60,000(A/P,i,1) − 42,000 + 40,000(A/F,i,1) (d ) AW = −100,000(A/P,i,5) − 42,000 + 15,000(A/F,i,5) Machine Age, Years from Purchase M&O Costs, $ per Year Salvage Value at End of Year, $ 1 42,000 60,000 2 47,000 40,000 3 49,000 31,000 4 50,000 24,000 5 52,000 15,000 6 54,000 10,000 7 63,000 10,000 8 67,000 10,000Cisco Systems is purchasing a new bar code - scanning device for its service center in San Francisco. The table on the right lists the relevant initial costs for this purchase. The service life of the system is 4 years and its salvage value for depreciation purposes is expected to be about 23% of the hardware cost. a. What is the cost basis of the device? b. What are the annual depreciations of the device if (i) the SL method is used? (ii) the 150% DB method is used? (iii) the 200% DB method is used? c. Calculate the book values of the device at the end of 4 years using all the methods above. Answers: (Round to the nearest dollar) (a) The cost basis of the device is $ (b) Annual depreciaitions and book values: (Round to the nearest dollar) Year 1 2 3 4 Book values at end of year 4 SL 69 69 69 69 69 150% DB 69 $ $ 200% DB 69 69 69 12 Cost Item Hardware Training Installation Cost $160,000 $16,000 $17,000
- Cisco Systems is purchasing a new bar code scanning device for its service center in San Francisco. The table on the right lists the relevant initial costs for this purchase. The service life of the system is 4 years and its salvage value for depreciation purposes is expected to be about 25% of the hardware cost. a. What is the cost basis of the device? b. What are the annual depreciations of the device if (i) the SL method is used? (ii) the 150% DB method is used? (iii) the 200% DB method is used? c. Calculate the book values of the device at the end of 4 years using all the methods above. Answers: (a) The cost basis of the device is (Round to the nearest dollar) (b) Annual depreciaitions and book values: (Round to the nearest dollar) Year 1 2 3 4 Book values at end of year 4 SL $ 150% DB $ 200% DB $ $ C Cost Item Hardware Training Installation Cost $165,000 $16,000 $14,000Two methods can be used to produce expansion anchors. Method A costs $ 70, 000 initially and will have a $15,000 salvage value after 3 years. The operating cost with this method will be $36,000 in year 1, increasing by $3200 each year. Method B will have a first cost of $ 116,000, an operating cost of $10000 in year 1, increasing by $10000 each year, and a $46, 000 salvage value after its 3 year life. At an interest rate of 8% per year, which method should be used on the basis of a present worth analysis?Two methods can be used to produce expansion anchors. Method A costs $70,000 initially and will have a $11,000 salvage value after 3 years. The operating cost with this method will be $22,000 in year 1, increasing by $2600 each year. Method B will have a first cost of $123,000, an operating cost of $8000 in year 1, increasing by $6500 each year, and a $33,000 salvage value after its 3-year life. At an interest rate of 15% per year, which method should be used on the basis of a present worth analysis? The present worth for method A is $ The present worth for method B is $[ Method (Click to select) is used to produce expansion anchors.