Explain your reasoning/support all of your decisions.

Veridian Dynamics is a research company that is working through the capital budget process for the upcoming year. Several capital budget proposals have been received and must be evaluated by management for feasibility. The company has a total of $3 million to spend on R&D. Attached are a selection of projects that manager Ted thinks the company is better off doing. Veronica from upper management has asked that you choose the final projects for approval from those submitted by Ted. To do so, complete the following:

Rank the projects in order of importance, payback, and cost

Keeping the budget of $3 million in mind, which projects do you approve for funding?

Why did you choose these projects? Provide thorough reasoning and support for your selections.

These are off the wall requests meant to be fun.

Project #1: Aerodynamic Bagels

Department: Research and Development/Administrative (Joint Venture)

Purpose: To create a more aerodynamic bagel that will make eating a bagel less labor intensive. This project is utilizing the science behind NASAs 1983 proposed space travel vehicles, affectionately known as the silver bagel, to change the way that we as a culture view the bagel. Having a bagel that is more aerodynamic will cut back on wind resistance created when an individual picks up the bagel and delivers it to their mouth. It is estimated that this project will reduce bagel eating time by 20% on average, which will allow individuals more time for productive endeavors within the workplace. The following estimates have been calculated:

67 bagels are consumed by Veridian Dynamics staff, on average, per day

The average employee spends 17.8 minutes eating one bagel

With the new aerodynamic bagel, this time can be cut down by 3.4 minutes to 14.4 minutes per bagel

Based on the calculation of 3.4 minutes x 67 bagels, productivity can be increased by 227.8 minutes each day, or 9112 minutes per week, for a total annual productivity of 473,824 minutes (approximately 7,897 hours)

Cost: $1.25 million

Payback Period: With an average employee wage of $12.50 per hour, the payback period would be 6,009,615 minutes.

Project #2: Self-cutting grass

Department: Maintenance and Grounds

Purpose: Replace the current lawn at Veridian with a self-cutting grass. The scope of the project will entail tearing out the current lawn and replacing it with a self-cutting lawn. This will eliminate the need for lawn mowers and personnel. In order to maintain the current length of grass for the 84 acre lawn, it requires 175 hours per week. The guy mowing the lawn is tiredhe needs sleep. He has not slept in 3 years. This new self-cutting grass will automatically cut itself when the blade length reaches the standard 3 inches.

Up front cost: $6,000 per acre

Annual cost savings: $60,000

Value of sleep: priceless

Project #3: The Jabberwocky Project

Department: Research and Development/Sales & Marketing (joint venture)

Purpose: Business is changing; changing at the speed of information. We need to change with it. This project will revolutionize the way Veridian does business. Completion of the Jabberwocky Project will move Veridian forward within the industry making it the primary company that everyone strives to be. In an industry that is very competitive and requires thinking outside of the box, this project will not only put the company on the map, but it will be declared its own superpower country.

Cost: $600,000

Payback period: with the revolutionary changes that this new project will bring it is too soon to tell what the tangible and intangible benefits will bring.

Project #4: Watercooler Replacement

Department: Employee Union

Purpose: Replace all current water coolersaka the dirty, non-functioning water fountain in the basementwith real water coolers. This project would purchase 15 water coolers, each offering both cold and hot clean water, with disposable cups. This will go a long way to stopping employees from striking. We will really do it this time. No really, not like 2014. A happy employee is a good employee. You need some good employees.

Cost: $25,000 up front

Ongoing cost: $3,000 per month

Payback Period: can you really put a price on employee happiness? Payback would be immediate.

Project #5: Replace Building Ventilation System

Department: Building Maintenance

Purpose: Replace the current ventilation system so it not only sounds like it is running but it really is working too. The ventilation system has been non-functioning for so long, no one in the building knows what clean air smells like. This is a safety issue and will reduce the number of employees experiencing migraines by 60%. This will also cut down on unproductive sick days.

Cost: $1.45 million for all floors; OR $65,000 first floor lab, $185,000 3^rd floor executive suites, $75,000 conference rooms, with remaining areas to be differed.

Payback period: immediate payback to employee health

Project #6: Raises for all Executives

Department: Executive Offices

Purpose: To reward executive employees for a job well done. This will result in the 5 top chief positions CEO, CFO, CIO, COO and CSO receiving a raise of 25%. These positions work hard both on and off the golf course. Shouldnt they be rewarded?

Cost: $3 million

Payback period: unknown