Evaluating two different irrigation system options

Assignment Help Financial Management

Reference no: EM131813304

The tempo golf country club in London, Ontario, is evaluating two different irrigation system options. An underground automatic irrigation system will cost 9.2 million to install and 80,000 pre tax annually to operate. It will not have to be replaced for 20 years. and aboveground system will cost 6.8 million to install, but 190,000 per year to operate. The above ground equipement has an effective operating life of 9 years. The country club leases its land from the city and both systems are considered leasehold improvements; as a result, straight-line capital cost allowance is used throughout, and neither system has any salvage value. which method should we select if we use a 13 percent discount rate? the tax rate is 39 percent.

Reference no: EM131813304

Questions Cloud

What can volkswagen and other companies learn : How to gain maximum learning and points from your discussion engagement - Your initial post must contain citation of the course concepts

Inflation-adjusted social security payments each year : Suppose, for our example, that you anticipate receiving $20,000 in inflation-adjusted Social Security payments each year

Discuss about randomly selected element of the population : A normally distributed population has mean 57,800 and standard deviation 750. Find the probability that a single randomly selected element X of the population.

How does systems thinking apply to an organizations culture : How does systems thinking apply to an organization's culture, goals, and structures? Write your initial response in 300-500 words.

Evaluating two different irrigation system options : The tempo golf country club in London, Ontario, is evaluating two different irrigation system options.

Prepare the journal entry to record this transaction : Jupiter Company sells goods that have a cost of $470,000 to Danone Inc. for $720,000, with payment due in 1 year. Prepare journal entry to record transaction

Determine the sales mix and cm by product and in total : Determine the sales mix, CM by product and in total, the CM ratio by product and in total, and the net income

Define standard deviation for samples : Find the probability that the mean of a sample of size 90 will differ from the population mean 12 by at least 0.3 unit, that is, is either less than 11.7.

What unit value royal decking use for each of its product : What unit value should Royal Decking use for each of its products when applying the lower of cost or market (LCM) rule to units of ending inventory

User Account

All Pages