For coal gas, the fuel cost is based on the values shown in table 2 (American...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
For coal gas, the fuel cost is based on the values shown in table 2 (American Dollars). The bungalow owner took a loan from a bank to be repaid in 5 years with 10% compound interest. The initial installation cost is shown in table 2. The following payments apply: ● Loan annual payment = 24.66 USD per 100 USD • Depreciation 5% of the initial installation cost Complete table 3, and based on the initial cost, total annual running cost and total annual operating cost, decide which of the two energy sources you would select to provide the heat requirements for the bungalow. Justify your choice. (3 marks) Fuel Coal Gas Natural Gas Tehli 2 Unit Cost First 52 therms per quarter at 23.36p per therm. Further therms in same quarter at 16.43p per therm, First 52 therms per quarter at 22.8p per therm. Further therms in same quarter at 15.30p per therm. Table 3: Annual operating costs for oil and solar energy sources Gas fired (Coal Solar Type of system Gas) $1000.00 Installation cost Annual payment on loan Annual depreciation cost Annual fuel cost Annual maintenance cost Annual standing charges Extra rates payable per year Total amount running cost Total annual cost $9.5 $8 $15 $2000.00 0 0 For coal gas, the fuel cost is based on the values shown in table 2 (American Dollars). The bungalow owner took a loan from a bank to be repaid in 5 years with 10% compound interest. The initial installation cost is shown in table 2. The following payments apply: ● Loan annual payment = 24.66 USD per 100 USD • Depreciation 5% of the initial installation cost Complete table 3, and based on the initial cost, total annual running cost and total annual operating cost, decide which of the two energy sources you would select to provide the heat requirements for the bungalow. Justify your choice. (3 marks) Fuel Coal Gas Natural Gas Tehli 2 Unit Cost First 52 therms per quarter at 23.36p per therm. Further therms in same quarter at 16.43p per therm, First 52 therms per quarter at 22.8p per therm. Further therms in same quarter at 15.30p per therm. Table 3: Annual operating costs for oil and solar energy sources Gas fired (Coal Solar Type of system Gas) $1000.00 Installation cost Annual payment on loan Annual depreciation cost Annual fuel cost Annual maintenance cost Annual standing charges Extra rates payable per year Total amount running cost Total annual cost $9.5 $8 $15 $2000.00 0 0
Expert Answer:
Answer rating: 100% (QA)
To complete Table 3 and determine the total annual running cost and total annual operating cost for the coal gas and natural gas options we need to calculate the annual payment on the loan annual depr... View the full answer
Related Book For
Finance Applications and Theory
ISBN: 978-0077861681
3rd edition
Authors: Marcia Cornett, Troy Adair
Posted Date:
Students also viewed these banking questions
-
On 1 January 20X1, Raiser plc. took a loan from BeeBank (at market conditions) amounting to 50 mil. with the interest of 7% p.a. to be paid in arrears on 31 December each year. Final maturity of the...
-
You have just received a loan from your bank for $19,000 and you will use it to buy a car. The interest rate is 6 percent and the term of the loan is 6 years. You will make 6 equal annual payments...
-
You have secured a loan from your bank for two years to build your home. The terms of the loan are that you will borrow $200,000 now and an additional $100,000 in one year. Interest of 10 percent APR...
-
In the first case, the relationship between F and H is found to be inverse when the height decrease the area will increase, and the force will increase too. Therefore, I need a logical and practical...
-
Explain the role of the availability of nutritional factors in infection by microorganisms in the body.
-
Joe and Jessie are married and have one dependent child, Lizzie. Lizzie is currently in college at State University. Joe works as a design engineer for a manufacturing firm while Jessie runs a craft...
-
Comparative stockholders' equity sections from two successive years of balance sheets from Farrow, Inc., are as follows: No dividends were declared or paid during 2018. Required Prepare the journal...
-
Use Solver to create a Sensitivity Report for question 18 at the end of Chapter 3 and answer the following questions: a. Which of the constraints in the problem are binding? b. If the company was...
-
How does costco motivate its employees? Would you like to work at costco? Why
-
The Outdoor Furniture Corporation manufactures two products, benches andpicnic tables, for use in yards and parks. The firm has two main resources; its carpenters(labor force) and a supply of redwood...
-
Tech Data Corp. uses a perpetual inventory system. The following activities occurred during May: May 1 - Tech Data purchased $100,000 worth of inventory, on credit terms 2/10 n/30. May 3 - Tech Data...
-
The controller of Oriole Production has collected the following monthly cost data for analyzing the behavior of electricity costs. Total Electricity Costs Total Machine Hours January $2,580 240...
-
Choose three companies to compare in terms of their codes of conduct from this website: https://i-sight.com/resources/18-of-the-best-code-of-conduct-examples/. Provide a summary of the main...
-
Contrast the Universal and Contingency Models of strategy development. Explain the key differences between these two approaches, highlighting their respective strengths and weaknesses. Additionally,...
-
Mario and Peach are racing along Rainbow Road each with an initial velocity of 19 m/s.The two of them are level until Peach hits a speed boost and experiences an acceleration of 2 m/s 2 for 2 s....
-
QUESTION TWO [35] Open dialogue and communication channels, like in the case of Coca-Cola, can be useful in preventing conflict. Discuss the various sources of conflict in business, as well as...
-
1. What percentage of the Nobel laureates were women? Construct a pie chart which shows how many prizes went to men compared to how many prizes went to women. Present your findings
-
Catherine (aged 42) and Johnson (aged 45) have been married for 12 years. Johnson is a project manager of an event company at a monthly salary of $55,000 with an additional one-month salary of...
-
Suppose that TapDance, Inc.s capital structure features 65 percent equity, 35 percent debt, and that its before-tax cost of debt is 8 percent, while its cost of equity is 13 percent. If the...
-
What is the value in year 4 of a $1,000 cash flow made in year 6 if interest rates are 8 percent?
-
Differentiate the characteristics of growth stocks and value stocks?
-
The following information from Jefferson Company's operations is available: Required a. Prepare a multiple-step income statement. Disregard earnings per share amounts. b. Prepare a single-step income...
-
Lincoln Corporation began the year with 50,000 shares of common stock outstanding. On May 1, an additional 18,000 shares of common stock were issued. On July 1, 20,000 shares of common stock were...
-
The following summarized data are related to Kennedy Corporation's operations: Required Prepare a multiple-step income statement for Kennedy Corporation. Include earnings per share disclosure at the...
Study smarter with the SolutionInn App