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handwriting please, and provide steps Part II Flamingo Inn has outsourced its laundry service to a contract cleaning company at an annual cost of $360,000.
handwriting please, and provide steps
Part II Flamingo Inn has outsourced its laundry service to a contract cleaning company at an annual cost of $360,000. Now, due to escalating costs, Flamingo is considering performing the service itself by purchasing new washers, dryers, and presses at a total cost of 500,000. Compared to outsourcing, the Financial Controller expects average cash savings of $150,000 per year. The machines are expected to last for 5 years with no residual value. The desired rate of return is 10% for this project. Given: Present Value of an Annuity $1 per Period: Periods 10% 1 0.9091 2 1.7355 3 2.4869 4 3.1699 5 3.7908 6 4.3553 7 4.8684 8 5.3349 9 5.7590 To evaluate whether to undertake any capital budgeting project proposal, the company only carry out those projects that can get back its investment capital within 2 yearsStep by Step Solution
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