Pls.

5 5 5. A number of Dendro Thermal Plants are being constructed in the Philpones One of the problem areas is transporting of cut wood from the planiation to the Dendro-Thermal Plant Two possible ateratives to accomplish this operation are by trucks and by cable transportation system The operation requires eight (3) to ten (10) hours per day, 365 days per year Average tons of cut wood to be transported per day is 100 tons. A tracking company has offered their services at an average cost of P 35.00 per tanto haul the cut wood from the plantation to the plant. If the Dendro-Thermal Plant owner wil install a cable transport system, the following expenses will be incurred 1. First cost of cable transit equipment including installation cost P2,500,000.00 2 Estimated annual maintenance cost 70,000.00 3. Labor cost to operate the system 8 to 10 hours per day 365 days a year 75,000.00 4 Overhead expenses and other miscellaneous expenditures, per year 80,000 od 5. Rate of interest on investment 16% e 2 Which of the two alternatives would you recommend? Economic life of cable trarsit is 10 years. Use ROR method. 5 5 5. A number of Dendro Thermal Plants are being constructed in the Philpones One of the problem areas is transporting of cut wood from the planiation to the Dendro-Thermal Plant Two possible ateratives to accomplish this operation are by trucks and by cable transportation system The operation requires eight (3) to ten (10) hours per day, 365 days per year Average tons of cut wood to be transported per day is 100 tons. A tracking company has offered their services at an average cost of P 35.00 per tanto haul the cut wood from the plantation to the plant. If the Dendro-Thermal Plant owner wil install a cable transport system, the following expenses will be incurred 1. First cost of cable transit equipment including installation cost P2,500,000.00 2 Estimated annual maintenance cost 70,000.00 3. Labor cost to operate the system 8 to 10 hours per day 365 days a year 75,000.00 4 Overhead expenses and other miscellaneous expenditures, per year 80,000 od 5. Rate of interest on investment 16% e 2 Which of the two alternatives would you recommend? Economic life of cable trarsit is 10 years. Use ROR method