A hotel is considering the purchase of a more efficient dishwashing system. The new system costs $40,000
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A hotel is considering the purchase of a more efficient dishwashing system.
The new system costs $40,000 and has a life of 10 years. The after-tax energy savings is estimated to be $2,000 per year, while the after-tax labor savings will be $2,500 per year. The WACC is 14%. Assume that the hotel’s depreciation will be unchanged by the purchase of the new system and that the sale value of the dish machine will be zero at the end of 10 years.
Required:
Calculate the NPV.
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Related Book For
Financial Management For The Hospitality Industry
ISBN: 9780131179097
1st Edition
Authors: William P Andrew, James W Damitio
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