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Please answer using formulas in Excel Currently, Bryer's Ice Cream uses Finamac continuous ice cream machines for their process. However, last week, Emery Thompson, a
Please answer using formulas in Excel
Currently, Bryer's Ice Cream uses Finamac continuous ice cream machines for their process. However, last week, Emery Thompson, a competitor of Finamac came into the facility to propose a new system that would improve the operation. The current Finamac system has the following characteristics: Production Rate on Line: Production Labor on line Production Labor rate 110 Gallons per minute $30 per hour, 8 hour/day, 5days a week for 50 weeks per year With the Emery Thompson system, there are many improvements: Production Rate on Line Production Labor on line Production Labor Rate: 150 Gallons per Minute 2 people $30 per hour, 8 hour/day, 5days a week for 50 weeks per year The new Emery Thompson system would cost $9,000,000 up front and would have required maintenance of $1,200,000 per year going up at 6% per year. Would you recommend this project at the company MARR of 6%? Assume that the project life is 10 years. Also, assume that the company can sell as many as product as it can produce for $0.5 per gallon. (Hint: Show your work on this Excel Sheet. Find Only one NPV for the new system and use the difference between the two alternatives. (Hint: Do not calculate 2 NPVs - Check principle 2 of fundemental princples of engineering economics in chapter 1) Do you recommend it
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