Costs 2,500.00 15,850.00 64,620.00 27,400.00 24,250.00 Net -2,500.00 -2,850.00 5,380.00 43,600.00 56,750.00 Cumulative -2,500.00 -5,350.00 30.00 43,630.00 100,380.00 Discount 1.0000 0.9259 0.8573 0.7938 0.7350 Factor 8% Discounted -2,500.00 -2,638.82 4,612.27 34,609.68 41,711.25 Net Net Present -2,500.00 -5,138.82 -526.55 34,083.13 75,794.38 Cost Benefit Analysis Solution Year Benefits Costs Annual Running (savings/ (investment/ Balance Balance returns) expenses) (b-c) (a) (b) (c) (d) (e) One $8,000 $58,000 $8,000 $2,000 $1400 x 50 $6,000 = $70,000 ($12,000) ($12,000) $82,000 Two $58,000 $2,000 $6,000 $70,000 $4,000 ($8,000) $66,000 Three $70,000 $66,000 $4,000 ($4,000)
Costs 2,500.00 15,850.00 64,620.00 27,400.00 24,250.00 Net -2,500.00 -2,850.00 5,380.00 43,600.00 56,750.00 Cumulative -2,500.00 -5,350.00 30.00 43,630.00 100,380.00 Discount Factor 8% 1.0000 0.9259 0.8573 0.7938 0.7350 Discounted Net -2,500.00 -2,638.82 4,612.27 34,609.68 41,711.25 Net Present -2,500.00 -5,138.82 -526.55 34,083.13 75,794.38 Cost Benefit Analysis Solution Year Benefits (savings/ returns) Costs (investment/ expenses) Annual Balance (b-c) Running Balance (a) (b) (c) (d) (e) One $1400 x 50 = $70,000 $8,000 $58,000 $8,000 $2,000 $6,000 $82,000 ($12,000) ($12,000) Two $70,000 $58,000 $2,000 $6,000 $66,000 $4,000 ($8,000) Three $70,000 $66,000 $4,000 ($4,000)
DPM-Mod-One-Workbook-2017.docx