Acme Manufacturing is looking to purchase a packaging machin…
Acme Manufacturing is looking to purchase a packaging machine for their widgets production line. The manufacturing engineer has identified two suppliers for the packaging machine, with estimated costs shown in the table below. The study period for this case is 10 years. You can assume repeatability and a MARR of 8%. The anticipated market value of a Pack-It-Up machine in year 10 is $6,500. Wrap-O-Matic Pack-It-Up Initial Cost $10,000 $22,500 Annual Maintenance $500 $700 Annual Labor Savings $2,400 $2,400 Salvage Value $1,400 $2,900 Useful Life 5 years 15 years b. Which alternative would you recommend if “do nothing” was an option? Why?
Read DetailsCostco is considering the addition of autonomous shopping ca…
Costco is considering the addition of autonomous shopping carts in their stores. The carts would follow customers as they shopped and would automatically scan items placed into the cart for touchless checkout when shopping is completed. The purchase of the initial shopping cart fleet is budgeted at $3.5 million, with estimated annual maintenance costs at $300,000 for the fleet. Annual operating costs are $200,000 for the fleet. The carts would remain in operation for 5 years, at which time they would be sold for $400,000. The Costco marketing team estimates an increase in annual revenue of $1.4 million directly attributed to this new transportation. b. If Costco uses a MARR of 10%, would you recommend for or against this project? Why?
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