Ramuk has reviewed the system models you created and is excited about creating a new system that will help him forecast demand and manage inventory. He has requested you to analyze cost-benefit data to assess the feasibility of using the product being offered by bakesmart bakery software. Use the pricing information for the Pro version of the software to calculate the NPV, the ROI and the break-even point for this system.

Assumptions:

• Ramuk has 5 employees
• 5-year life for this analysis
• All employees at Ramuk Bakery will have to be trained
• Ramuk wants to purchase 1 desktop and two tablets for the bakery
• Ramuk will need access to the internet
• Interest rate 6% for calculating present value

Expected system benefits

• Sales are expected to increase by $10,000 in the first year and then will grow by 5% annually due to better demand forecasting
• Inventory costs savings are expected to be $5,500 annually

Notes: Please use MS-Excel