Mega Corporation - Purchase of GargantuLift 6000 Analysis

Betty's original make analysis

assumption: interest rate (5%)
Year 0
Pre-transaction
Internal Time and Effort
Travel & Related Assessment and
Recommendation Costs
Transaction
Purchase Cost
Post-transaction
Initial Training
Yearly Maintenance
Major Overhaul (in 5 years)
Annual Operating
Annual Wages and Benefits

Year 1

Year 2

Year 3

Year 4

$50,000

$50,000

$50,000

$50,000

$100,000
$200,000

$100,000
$200,000

$100,000
$200,000

$100,000
$200,000

$350,000
95.24%
$333,333

$350,000
90.70%
$317,460

$350,000
86.38%
$302,343

$350,000
82.27%
$287,946

$500,000
$150,000

$11,000,000

$20,000

Future Dispoal Value

Total Cost
Discount Factor
Discounted Value
Total Discounted Cost

$11,670,000
$11,670,000
$14,364,137

Year 5

Year 6

Year 7

Year 8

Year 9

Year 10

$50,000

$50,000
$400,000
$100,000
$200,000

$50,000

$50,000

$50,000

$50,000

$100,000
$200,000

$100,000
$200,000

$100,000
$200,000

$100,000
$200,000

$100,000
$200,000

-$500,000
$350,000
78.35%
$274,234

$750,000
74.62%
$559,662

$350,000
71.07%
$248,738

$350,000
67.68%
$236,894

$350,000
64.46%
$225,613

-$150,000
61.39%
-$92,087