2. To reduce flood damage in a river valley in Southern Luzon, a flood control dam is being proposed for construction. The initial cost is estimated to be P4,600,000, with annual maintenance and inspection costs of P24,000. Every 5 years, minor reconstruction work will be undertaken on the dam at a cost of P150,000. If the dam is built, flood damage is expected to be reduced from P800,000 to P100,000 annually. Assuming the dam to be permanent and the interest rate is 8%, should the dam be built?
Q: reatment plant is to be constructed in Washington County. The initial installation will cost $40…
A: Capitalised cost = All Costs incidental to asset + Present value of future cost which is incurred in…
Q: The construction cost of a permanent water park is $550,000. Annual maintenance and operation costs…
A: Note: As per the policy, we are supposed to solve one question at a time. Kindly repost the other…
Q: r pipeline system is installed in an industrial site that requires ₱12,500,000 initial investment.…
A: Capitalized cost of project are present value of all cost that would occur in future over the period…
Q: A local government's plan to build a flood canal at a cost of Rp50 trillion this year raises pros…
A: Cost to build flood canal = 50 trillion Losses in case of no canal = 400 trillion Time period when…
Q: TO REMEDY THE TRAFFIC SITUATION AT A BUSY INTERSECTION IN QUEZON CITY, TWO PLANS ARE BEING…
A: PW is the present value (PV) of all the cashflows incurred in the future related to the project. It…
Q: The government has two (2) plans to deal with their water supply problem in Zamboanga. Option 1 is…
A: Present value of includes the all cost that are going to occur during the use of equipment life…
Q: To promote sports in Qatar, the National Olympic committee is planning to construct a new handball…
A: Benefit to Cost ratio: It is an indicator that is utilized in cost–benefit analysis to show the…
Q: Two methods of carrying away surface runoff water from a new subdivision are being evaluated: METHOD…
A: The question is based on the concept of present worth calculation of project.
Q: The Estrella-Pantaleon Bridge connecting Estrella, Makati City to Barangka Drive in Mandaluyong is a…
A: Formula for calculating equivalent annual cost:
Q: An Army Corps of Engineers project for improving navigation on the Ohio River will have an initial…
A: Present value is the current value of the money that is expected to be received from the investment…
Q: To reduce flood damage in a river valley in Southern Luzon, a flood control dam is being proposed…
A:
Q: What is the present worth of all the damages for 15 years?
A: Present Worth: It is the current worth of future annual cash flows streams or future sum of money.…
Q: A highway bridge is being considered for replacement. The new bridge would cost $X and would last…
A: The maximum acceptable price would be the cost of existing bridge and also the benefit from the new…
Q: ent of Public Works and Highways is considering the construction of new highway through a scenic…
A: Benefit cost ratio is present value of annual benefits to initial investment.
Q: To remedy the traffic situation at a busy intersection in Quezon City, two plans are being…
A: A cash flow statement, also known as a statement of cash flows in financial accounting, is a…
Q: Part a - Use present worth to choose the best project What is the PW of Project A (in millions of…
A: Information Provided: Life = 25 years MARR = 10%
Q: o decrease costs of operating a lock in a large river, a new system of operation is proposed. It…
A: The cost of any project or asset is capitalized if the benefits from such cost are going to be…
Q: city plans to upgrade its storm water management infrastructure by installing new pes. The…
A: In this we need to find the present value of all cost required during the life of project.
Q: 1.You are working on a bid to build THREE city parks a year for the next three years. This…
A: Hi, Question has multiple sub parts. As per guidelines, first three sub parts can be answered.
Q: A company is considering constructing a plant to manufacture a proposed new product. The land costs…
A: While considering the project, its net present value (NPV) shall be computed by discounting the cash…
Q: A commercial building is proposed to be built in a subdivision. The initial cost is estimated to be…
A:
Q: o maintain its newly acquired equipment, the company needs P40,000 every year for the first 5 years…
A: Given information: Cash flows for 10 years are given, where the first 5 cash flows are same and the…
Q: 1. This project must fund the construction of an on/off-interchange from an adjacent highway, a…
A: Step1: Calculating the amount will need to be funded today to meet the complete funding requirements…
Q: The average annual cost of damages caused by flooding to a subdivision near Pasig River is estimated…
A: Time value of money is the concept widely used by the management accountant to determine the worth…
Q: An airport expansion that is expected to be used indefinitely is under way at Jackson Hole Metro…
A: Under Perpetual Cost. Land Acquisition Cost = Annual Cost/Interest % 600,000,000= Annual Cost/5%…
Q: The Estrella-Pantaleon Bridge connecting Estrella, Makati City to Barangka Drive in Mandaluyong is a…
A: Initial Cost is the cost that is incurred during the design and construction process.
Q: The cost of a fence that can detect poacher intrusion into a National Wildlife Preserve is $2.4…
A: The annual worth method is a method of finding the profitability of a project by assigning the…
Q: A new bridge across the Allegheny River in Pittsburgh is expected to be permanent and will have an…
A: Data given: Initial cost =$ 30,000,000 Resurfaced cost = $1000,000 ( every 5 year) Annual inspection…
Q: The Estrella-Pantaleon Bridge connecting Estrella, Makati City to Barangka Drive in Mandaluyong is a…
A: Equivalent annual cost is computed by dividing the total cash flow by the present value annuity…
Q: find the capitalized cost.
A: Capitalization cost is defined as those costs which become part of the actual asset price. These…
Q: A highway bridge is being considered for replacement. The new bridge would cost $X and would last…
A:
Q: A company is intending to invest in a capital budgeting project to manufacture a medical testing…
A: Net Present Value of a project helps in determining if the project will be useful or not. It is…
Q: A highway bridge is being considered for replacement. The new bridge would cost $X and would last…
A: Data given: New Bridge:: Cost = $X N= 24 years Annual Maintenance = $24,000 Toll charge for each…
Q: A new municipal refuse-collection truck can be purchased for $84,000. Its expected useful life is…
A: Purchase price (P) = $84000 Annual cashflow (A) = $18000 r = 19% n = 6 years
Q: The city of Zamboanga contemplates to increase the capacity of their existing water transmission…
A: PW or NPV is the method to find the net benefit which can be generated from the future cashflows. It…
Q: To address the chronic traffic condition at a major thoroughfare, two plans are being considered.…
A: NPV is a capital budgeting techniques which help in calculating the present value of any project on…
Q: Jones Excavation Company is planning an investment of $233,500 for a bulldozer. The bulldozer is…
A: Honor Code: Hi there, thanks for posting the questions. But as per our Q&A guidelines, we must…
Q: 4. Two large-scale conduits are under consideration by a large municipal utility district (MUD). The…
A: The Present Value: The total value of future cash flows at the current date is known as its present…
Q: A new highway is to be constructed. Design A calls for a concrete pavement costing 3600 per foot…
A:
Q: The Cebu City plans to increase the capacity of her existing water transmission lines. Two plans are…
A: Capital budgeting refers to the investment in long-term capital assets by determining the…
Q: proposed new product. The land `costs P15,000,000, the building costs P30,000,000, the equipment…
A: Capital budgeting is a financial commitment as well as an investment.By applying active, the…
Q: ABC company is considering constructing a plant. The land costs 15,000,000 pesos, the building costs…
A: Generally, there are several methods used in practice and all of them will give equal results. And…
Q: A cooling water pumping station at a manufacturing plant in N City cost $30,000,000 to construct,…
A:
Q: ): A county is considering three locations for a new dam. The three alternatives for the dams for…
A: If the dams are constructed in 3 places the incremental benefits and costs would be -
Q: Street lighting fixtures and their sodium vapor bulbs for a two-block area of a large city need to…
A: Addition of expenses in Balance Sheet to the cost basis of fixed assets is called Capitalized Cost.…
Q: The Department of public Works and Highways (DWH) is considering the construction of a new highway…
A: The present value of the future sum denotes the discounting of the future value to arrive at their…
Q: An area on the Colorado River is subject to periodic flood damage that occurs, on the average, every…
A: PV is the current worth of cash flows that are expected to occur in the future.
Step by step
Solved in 2 steps with 2 images
- The average annual cost of damages caused by floods to certain subdivision located along Pasig River is estimated at P700,000. To build a gravity dam to protect the area from the floods, would cost P2,500,00.00 and would involved an annual maintenance cost of P20,000.00. With interest at 8% compounded annually, how many years will it take for the dam to pay for itself?The average annual cost of damages caused by floods to a certain subdivision located along Pasig River is estimated at Php 700,000. To build a gravity dam to protect the area from floods, would cost Php 2.5M and would involve an annual maintenance cost of Php 20,000.00. With interest rate at 8% compounded annually, how many years will it take for the dam to pay for itself?The Cebu City plans to increase the capacity of her existing water transmission lines. Two plans are under consideration. Plan A requires the construction of a parallel pipeline, the flow being maintained by gravity. The initial cost is P197,342,811 and the life is 40 years, with an annual operating cost of P8,450,154 for the 1st 20 years and P13,297,046 for the next 20 years. Plan B requires the construction of a booster pumping station costing P100M with the life of 40 years. The pumping equipment cost an additional amount of P25M, it has a life of 20 years and a salvage value of P2M. The annual operating cost is P5M. Using the Present Value (PV) Method and an interest of 21% cpd. annually, what is the PV of Plan A?
- The government plans to increase the capacity of her existing water transmission lines in Cebu City. Two plans are under consideration. Plan A requires the construction of a parallel pipeline, the flow being maintained by gravity. The initial cost is P182,947,337 and the life is 50 years, with an annual operating cost of P5,725,635 for the 1st 25 years and P11,441,794 for the next 25 years. Plan B requires the construction of a booster pumping station costing P100M with the life of 50 years. The pumping equipment cost an additional amount of P25M, it has a life of 25 years and a salvage value of P2M. The annual operating cost is P5M. Using the Present Value (PV) Method and an interest of 23% cpd. annually, what is the PV of Plan A?a flood control dam is being proposed for construction. The initial cost is estimated to be P4,600,000, with annual maintenance and inspection costs of P24,000. Every 5 years, minor reconstruction work will be undertaken on the dam at a cost of P150,000. If the dam is built, flood damage is expected to be reduced from P800,000 to P100,000 annually. Assuming the dam to be permanent and the interest rate is 8%, should the dam be built?(engineering economics) A building was purchased by the city government with a gradual payment of Rp. 20 billion at the time of purchase and followed by Rp. 40 billion a year later. The building is expected to be used by the community for 20 years starting after the second payment is made. During operation the dam will require operational and maintenance costs of Rp. 750 million annually. Meanwhile, the benefits that will be obtained by the community as a result of these facilities can be equivalent to Rp. 5 billion per year. In addition, this facility also generates direct income of Rp. 4.7 billion per year. Alternatively, the building can be renovated prior to use. If it is going to be renovated, the city government needs to spend an additional Rp. 10 billion for the two payments as mentioned above. The operational and maintenance costs have not changed, which are still Rp. 750 million per year, while the annual income will increase to Rp. 5.6 billion. Determine alternatives without…
- Q) The average annual cost of damages caused by floods to Camella subdivision is estimated to be ₱500,000. To build a gravity dam to protect the area from floods would cost ₱3,000,000 and would involve an annual maintenance cost of ₱25,000. With the interest rate of 8% compounded annually, how many years would it take for the dam to pay for itself? Solve it correctly. And not solve in excel works. Typed or handwriting use onlys.The government has two (2) plans to deal with their water supply problem in Zamboanga. Option 1 is to build a complete water pumping plant costing P 2 Billion, which would meet all needs during the 1st 40 years. Annual maintenance costs are estimated to be at P 20M for the 1st 23 years and P 24968327 for the succeeding years, which is the difference between 40 years and 23 years. Option 2 is to build a partial water pumping plant at a cost of P 1.25 Billion, which would be sufficient for the 1st 15 years. At the end of 15 years, the pumping plant will be completed at an estimated cost of P 1.5 Billion. Annual maintenance cost is P 1.5 Million during the 1st 15 years and P3 Million for the succeeding 15 years. At 20% cpd.-a., what is the Present Value of Option 1?The city of Zamboanga contemplates to increase the capacity of their existing water transmission lines. Two plans are under considerations. Plan A requires the construction of a parallel pipeline, the flow being maintained by gravity. The initial costs is P2, 750, 000.00 and the life is 40 years, with an annual operating cost of P5, 000.00. Plan B requires the construction of a booster pumping stations coating P1, 050, 000.00 with the life of 40 years. The pumping equipment cost an additional amount of P250, 000.00, it has a life of 20 years and a salvage value of P25, 000. The annual operating costs is P165, 000.00. Which is the most economical plan if the interest rate is 12% and how much is the difference between the two plans. Use present worth method.
- An Army Corps of Engineers project for improving navigation on theOhio River will have an initial cost of $6,500,000 and annualmaintenance of $130,000. Benefits for barges and paddle wheel touringboats are estimated at $820,000 per year. The project is assumed to bepermanent and the discount rate is 8% per year. Determine if theCorpsshould proceed with the project.A proposed bridge on the interstate highway is being considered at the cost of 4 million dollars. It is expected that the bridge will have a life of 30 years. Construction costs will be paid by government agencies. Operation and maintenance costs are estimated to be $250,000 per year. Benefits to the public are estimated to be $900,000 per year. The building of the bridge will result in an estimated cost of $250,000 per year to the general public. The project requires a return of 5%. Determine the benefit/cost (B/C) ratio.The Newfoundland government is considering three new flood control projects for the Badger area. Projects A and B consist of permanent dikes. Project C is a small dam. The dam will have recreation and irrigation benefits as well as the flood control benefits. Facts about the three projects are shown in the following table. Each project has a life of 25 years. The MARR is 10%. Project A Project B Project C First Cost (millions of $) 206 236 402 Annual Benefits (millions of $) 26.8 32.1 56.8 Annual Operating and Maintenance costs (millions of $) 2.9 2.1 4.8 Part a - Use present worth to choose the best project What is the PW of Project A (in millions of dollars rounded to two decimal points eg. x.xx)? What is the PW of Project B (in millions of dollars rounded to two decimal points eg. x.xx)? What is the PW of Project C (in millions of dollars rounded to two decimal points eg. x.xx)? Which Project is the best choice (Enter either 'A',…