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Laptop Replacement
Year 0
Investment Depreciable
Replacement Laptops ( to be spend in $1,000 each nurse yes
Laptop Conversion $5,000 total cost Yes
Nurse Training
Staff Training

Nurse Staffing Year 0 Year 1 Year 2

Nurses 40 43 45
Change in # of nursesNurses 0 3 5
Visits per week 30 30 30
Change in Visits per week 0 0
Weeks per year 48 48
Addl.Visits per year (calculated) 4,320 7,200
Nursing Salaries ea. incl. benefits $95,000 $95,000

Office Staffing
Added staff 0 0 0
Staff Salary incl. benefits
Revenue
Average revenue per visit $112.00 all years
Cost per visit
Travel cost $6.50 per visit all years
Cloud Processing cost $0.00 per visit all years
Supplies $8.00 per visit all years
Annual Expenses
Tablet Software Licenses $0.00 annually per nurse all years
Site Office software $0.00 annually- all all years
Site Maintenance contract $45,000.00 annually- all all years
Wireless contract $0.00 Monthly per nurse all years
Other
Present Laptops Book Value $0.00 each
Time horizon 3 Years
Tax Rate 22%
MARR 14%
MACRS 3 years

Solution
 Tablet Proposal
Year 3 Year 0
Investment
Replacement Tablets $750.00 each nurse
Database Conversion $30,000.00 total cost
Nurse Training $500.00 each nurse
Staff Training $10,000.00 total cost

Year 3 Nurse Staffing Year 0 Year 1

47 Nurses 40 40
7 Change in # of nursesNurses 0 0
30 Visits per week 30 32
0 Change in Visits per week 2
48 Weeks per year 48
10,080 Addl.Visits per year (calculated) 3,840
$95,000 Nursing Salaries ea. incl. benefits $95,000

Office Staffing
0 Added staff 1
Staff Salary incl. benefits $60,000 $60,000
Revenue
Average revenue per visit $112.00
Cost per visit
Travel cost $6.50
Cloud Processing cost $3.00
Supplies $8.00
Annual Expenses
Tablet Software Licenses $50.00
Site Office software $40,000.00
Site Maintenance contract $35,000.00
Wireless contract $500.00
Other
Present Laptops Book Value $0.00 each
Time horizon 3 Years
Tax Rate 22%
MARR 14%
MACRS 3 years

Solution
sal
Year 3
Depreciable
Yes
Yes
No
No

Year 2 Year 3
40 40
0 0
34 35
4 5
48 48
7,680 9,600
$95,000 $95,000

1 1
$60,000 $60,000

all years

per visit all years

per visit all years
per visit all years

annually per nurse all years

annually- all all years
annually- all all years
Monthly per nurse all years
Laptop Replacement
Year Cost per visit per year 0 1
Change in # of Nurses 15
Replacement capex per nurse $1,000
Laptop Replacement capex $15,000
Laptop Conversion cost $5,000
Total Capex ($20,000)

Revenue
Additional visits of patients per year 4,320
Avg revenue per visit per year $112.00
Yearly incremental revenue $483,840

Costs
Travel cost per visit per year $6.50
Cloud processing cost per visit per year $0.00
Supplies per visit per year $8.00
Total per visit cost per year $14.50

Incremental vist cost per year ($62,640)

Annual site maintenance contract ($45,000)
Nursing Salaries ea. incl. benefits ($285,000)
Total annual incremental cost ($392,640)

Annual Depreciation rate (MACRS 3-Yrs) 33.33%

Annual Depreciation ($6,666)
Total annual incremental cost incl depreciation ($399,306)

Profit before tax $84,534

Less: Tax at 22% ($18,597)
Profit after tax $65,937
Add: Depreciation $6,666
Add: Salvage Value (If any)
Less: Capex ($20,000)
Free Cash Flow ($20,000) $72,603
Discounting Factor 14% 1.0000 0.8772
PV of FCF ($20,000) $63,686
NPV or Present Worth $298,488
IRR 434.85%
 2 3 4

7,200 10,080 -

$806,400 $1,128,960 $0

($104,400) ($146,160) $0
($45,000) ($45,000) $0
($475,000) ($665,000) $0
($624,400) ($856,160) $0

44.45% 14.81% 7.41%

($8,890) ($2,962) ($1,482)
($633,290) ($859,122)

$173,110 $269,838
($38,084) ($59,364)
$135,026 $210,474
$8,890 $2,962
$0

$143,916 $213,436
0.7695 0.6750
$110,739 $144,063
Tablet Proposal
Year Cost per visit per year 0 1
Existing force of nurses 40
Tablet capex per nurse $750
Laptop Replacement capex $30,000
Database conversion $30,000
Equipment Capex ($60,000)
Nurse Training $20,000
Staff Training $10,000
Training Capex ($30,000)
Total Capex ($90,000)

Revenue
Additional visits of patients per year 3,840
Avg revenue per visit per year $112.00
Yearly incremental revenue $430,080

Costs
Travel cost per visit per year $6.50
Cloud processing cost per visit per year $3.00
Supplies per visit per year $8.00
Total per visit cost per year $17.50
Tablet Software License (Annual cost per nurse) $50
Wireless contract (monthly cost per nurse) $500.00

Incremental vist cost per year ($67,200)

Incremental staff salary ($60,000)
Annual site maintenance contract ($35,000)
Site Office Software ($40,000)
Tablet Software License ($2,000)
Wireless contract ($240,000)
Incremental Nursing Salaries ea. incl. benefits $0
Total annual incremental cost ($444,200)

Annual Depreciation rate (MACRS 3-Yrs) 33.33%

Annual Depreciation ($19,998)
Total annual incremental cost incl depreciation ($464,198)

Profit before tax ($34,118)

Less: Tax at 22% 22% $7,506
Profit after tax ($26,612)
Add: Depreciation $19,998
Add: Salvage Value (If any)
Less: Capex ($90,000)
Free Cash Flow ($90,000) ($6,614)
Discounting Factor 14% 1.0000 0.8772
PV of FCF ($90,000) ($5,802)
NPV or Present Worth $398,491
IRR 123.39%
 2 3 4

7,680 9,600 -

$860,160 $1,075,200 $0

($134,400) ($168,000) $0
($60,000) ($60,000)
($35,000) ($35,000) $0
($40,000) ($40,000) $0
($2,000) ($2,000) $0
($240,000) ($240,000) $0
$0 $0 $0
($511,400) ($545,000) $0

44.45% 14.81% 7.41%

($26,670) ($8,886) ($4,446)
($538,070) ($553,886)

$322,090 $521,314 $0
($70,860) ($114,689) $0
$251,230 $406,625 $0
$26,670 $8,886 $0
$0 $0

$277,900 $415,511 $0
 0.7695 0.6750 -
$213,835 $280,458 $0