find the capitalized cost.
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A site is under consideration for a bridge over a small river. The suspension bridge will cost $500M with annual inspection and maintenance cost of $350,000. In addition, the concrete deck would have to be reconstructed every 10 years at a cost of $1M. The cost of purchasing the right of way is expected to be $20M. find the capitalized cost.
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- 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 following are the costs for one of the alternatives to construct a new bridge: Construction cost = $2200000 M Annual Maintenance cost = $48000 Renovation cost = $800000 every 15 years Based on an interest rate = 5% per year, what is the capitalized cost of this alternative? M RA sports complex is to be constructed. Two plans are under consideration. Plan A is to construct a three-storey building with provision for adding 12 stories at a future date. The cost of this initial building is P 3,100,000. In 10 years, the 12 stories can be added at a cost of P 10,200,000. The life of the structure is 35 years with zero salvage value. Plan B is to construct for P 1,110,000 three-storey building which will be demolished after 10 years and replaced by a 15-storey structure at a cost of P 18,300,000. The life of the structure is 35 years. Maintenance on Plan A will be P 40,000 and Plan B P 35,000 per year for the first 10 years, and after they be alike. The property taxes will be 4% and money is worth 20%. Which plan would you recommend?
- The construction cost of a permanent water park is $550,000. Annual maintenance and operation costs are $100,000 per year. A) At an interest rate of 7% per year, find the capitalized cost of the park in present worth. (Hint: a capitalized cost is when every cost is brought to present worth, in this case the upfront construction costs are current). B) What would be the annualized cost if the whole project was to be financed over 25 years at 6% interest?A sports complex is to be constructed. Two plans are under consideration:Plan I is to construct a three-storey building with provision for adding 12 stories at a future date. The cost of thisinitial building is P 3,100,000.00. In 10 years the 12 stories can be added at a cost of P 10,200,000.00. The lifeof the structure is 35 years with zero salvage value.Plan II is to construct for P 1,110,000.00 a three-storey building which will be demolished after 10 years andreplaced by a 15-storey structure at a cost of P 18,300,000.00. the life of the structure is 35 years.The maintenance of Plan I will be P 40,000.00 and Plan II is P 35,000.00 per year for the first 10 years. After thatthey will be alike. The property Taxes will be 4%. Money is worth 20%.Which plan would you recommend? Use Present worth of Cost Method.A Project study for the construction of an engineering building are under consideration. Based on the study the cost of the building is P6,500,000 with a life of 30 years and a salvage value of P 400,000. Yearly maintenance and repair is P 18,000. If the yield of investment is 6%, determine the future worth cost.
- Sta. Elena Golf & Country Estate wants to have a swimming pool in the vicinity. The general contractor presented a reinforced concrete design for the swimming pool which needs an initial investment of P21000000. By approximation of costs, refinishing including repaints of the inner surface would amount to P2750000 every 10 years. Determine the present worth of all costs assuming an infinite use for the pool. Prevailing rate of interest is 5%.Two sites are currently under consideration for a bridge over a small river. The north site requires a suspension bridge. The south site has a much shorter span, allowing for a truss bridge, but it would require new road construction.The suspension bridge will cost $500 million with annual inspection andmaintenance costs of $350,000. In addition, the concrete deck would have to be resurfaced every 10 years at a cost of $1,000,000. The truss bridge and approach roads are expected to cost $250 million and have annual maintenance costs of $200,000. This bridge would have to be painted every 3 years at a cost of $400,000. In addition, the bridge would have to be sandblasted every 10 years at a cost of $1,900,000. The cost of purchasing right-of-way is expected to be $20 million for the suspension bridge and $150 million for the truss bridge. Compare the alternatives on the basis of their capitalized cost if the interest rate is 6% per year.An organization is planning to put up its own building. Two proposals being considered are:A. The construction of the building now to cost P 400,000 B. The construction of a smaller building now to cost P300,000 and at the end of 5 years, anextension to be added to cost P 200,000.By how much is proposal B more economical than proposal A if interest rate is 20% and depreciation to be neglected?
- A proposed cost-saving device has an installed cost of $905,000. The device will be used in a five-year project but is classified as three-year MACRS property for tax purposes. The required initial net working capital investment is $65,000, the tax rate is 22 percent, and the project discount rate is 9 percent. The device has an estimated Year 5 salvage value of $125,000. What level of pretax cost savings do we require for this project to be profitable? (MACRS schedule) Note: Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16. Required cost savingsStriped Potato is evaluating a project that would require the purchase of a piece of equipment for $365,000 today. During year 1, the project is expected to have relevant revenue of $216,000, relevant costs of $57,000, and relevant depreciation of $84,000. Striped Potato would need to borrow $365,000 today to pay for the equipment and would need to make an interest payment of $14,000 to the bank in 1 year. Relevant net income for the project in year 1 is expected to be $44,000. What is the tax rate expected to be in year 1?You are working on a bid to build two city parks a year for the next three years. This project requires the purchase of $185,000 of equipment that will be depreciated using straight-line depreciation to a zero book value over the 3-year project life. The equipment can be sold at the end of the project for $34,000. You will also need $20,000 in net working capital for the duration of the project. The fixed costs will be $18,000 a year and the variable costs will be $168,000 per park. Your required rate of return is 15 percent and your tax rate is 34 percent. What is the minimal amount you should bid per park? A $128,600 B $154,300 C) $72,500 E $219,900 $189,100
