The Acme Corporation considers increasing its recycling efforts as a part of the green manufacturing initiative by the local government. The Acme Corp. prides itself on being agood corporate citizen and has committed to taking any and all feasible actions to reduce the volume and weight of material it sends to the local landfill. The local landfill offers to rebate $5 for each ton less than the current 12- month average that the plant sends to the landfill. The plant does not foresee any changes in the current levels of waste generation due to volume or product changes. Consider the following assuming that the manufacturing plant for the Acme Corp operates5 days a week, 50 weeks a year and the minimum attractive rate of return is 15%. Currently, the manufacturing plant sends its waste to the landfill in containers. The containers average 10 tons of waste when loaded. The landfill charges S40 per ton toreceive the waste. The waste hauler charges $80 per load one container) to transport thewaste. The company has identified two potential sources of waste reduction: cardboards andwooden pallets. Cardboard, if bundled and prepared for shipment, can be sold for $95 per ton. The plantestimates that it currently sends 2 tons of cardboard a day to the landfill. Preparing the cardboards will require one janitorial associate for 3 hours per day at a cost of $20 perhour. The baling equipment will cost $30,000 for installation, $45 per week to operate, $4500 per year to maintain, and last 12 years. The equipment will have a salvage value of $3000 at the end. Currently, 25,000 wooden pallets per year are scrapped each year because they are damaged or because they are not of the standard size used by the plant. The pallets average 13 pounds each. A pallet recycler has offered to purchase pallets, which are of certain sizes and in good condition. The pallets that are in these sizes and in acceptable condition amount to half the scrapped pallets. The pallet recycler is offering to pay $1.00 per pallet. Preparing the pallets in an acceptable form will require a cutting machine that will cost $12,000 for installation, $3000 per year to operate and three hours of labor per day. This job can also be done by a janitorial associate. The machine will have a useful lifeof 6 years and no salvage value at the end. Finally, purchasing has identified a company, that will pick up the damaged and unusablepallets and process them into wood chips, which this company then sells. The cost of this service is $1.25 per pallet. Using this information, find the best recycling strategy for the company among thefollowing options: Option 0: Status quo (no recycling) - Option 1: Recycling cardboards only Option 2: Recycling cardboards and usable wooden pallets (without selling the unusable pallets) Option 3: Recycling cardboards, usable and unusable wooden pallets | Instructions All answers should appear in the appropriate place in the template spreadsheet. 1) Transfer the appropriate information from above into the Excel worksheet (in cellsC5:C42) 1) Calculate the initial costs, annual savings, annual costs and salvage values using thegiven information for: a) Recycling cardboards only (in cells E15:H17) - Investment comes from the installation cost - Annual savings include cardboard sales + rebate from waste reduction (offered bythe landfill company) + savings from landfill and transportation (by not sending cardboard waste to landfill) - Annual costs include labor + operation + maintenance costs - Salvage value comes from the resale value of the baling equipment b) Recycling usable wooden pallets only (in cells E26:H28) - Investment comes from the installation cost - Annual savings include usable wooden pallet sales + rebate from waste reduction (offered by the landfill company) + savings from landfill and transportation (by not sending usable pallet waste to landfill) - Annual costs include labor + operation costs - Salvage value comes from the resale value of the cutting machine c) Selling unusable wooden pallets only (in cells E37:H39) - Investment is not applicable - Annual savings include rebate from waste reduction offered by the landfill company) + savings from landfill and transportation (by not sending unusablepallet waste to landfill) - Annual costs comes from the cost of service. - Salvage value is not applicable 2) Use Excel's PMTO function to calculate the annual worth of Option 1-3 (in cellsC46:C48) assuming that annual worth for Option 0 is equal to 0. Hint: Be careful with the sign convention of PMT function. 3) Make a recommendation for the best recycling strategy to the manager of The AcmeCorp. Problem Parameters MARR Weeks per year Days per week Rebate per ton per yer Container capacity in tons Landfill charge per ton Hauler charge per container Recycling Cardboards For Recycling Cardboards Investment Annual Savings Annual Costs Salvage Value Price per a ton of Cardboard Amount of Cardboard (in tons/year) Installation Cost Annual Labor Cost Annual Operating Cost Annual Maintenance Cost Annual Rebate (from Waste Reduction) Annual Savings from Landfill and Transportation Salvage Value (EOY12) Recycling Usable Pallets For Recycling Usable Wooden Pallets Investment Annual Savings Annual Costs Salvage Value Price per Usable Pallet Number of Usable Pallets (per year) Single Pallet Weight (lb) Installation Cost Annual Labor Cost Annual Operating Cost Annual Rebate (from Waste Reduction) Annual Savings from Landfill and Transportation Salvage Value (EOY6) Recycling Unusable Pallets Price per Unsable Pallet For Selling Unusable Wooden Pallets Number of Unusable Pallets (per year) Investment Annual Savings Annual Costs Salvage Value Single Pallet Weight (lb) Annual Service Cost Annual Rebate (from Waste Reduction) Annual Savings from Landfill and Transportation Annual Worths AW of Option 1 AW of Option 2 EAW of Option 3 (Recycling cardboards only) (Recycling cardboards + usable pallets) (Recycling cardboards + usable pallets + unusable pallets) Recommendation Which option do you recommend? 0 The Acme Corporation considers increasing its recycling efforts as a part of the green manufacturing initiative by the local government. The Acme Corp. prides itself on being agood corporate citizen and has committed to taking any and all feasible actions to reduce the volume and weight of material it sends to the local landfill. The local landfill offers to rebate $5 for each ton less than the current 12- month average that the plant sends to the landfill. The plant does not foresee any changes in the current levels of waste generation due to volume or product changes. Consider the following assuming that the manufacturing plant for the Acme Corp operates5 days a week, 50 weeks a year and the minimum attractive rate of return is 15%. Currently, the manufacturing plant sends its waste to the landfill in containers. The containers average 10 tons of waste when loaded. The landfill charges S40 per ton toreceive the waste. The waste hauler charges $80 per load one container) to transport thewaste. The company has identified two potential sources of waste reduction: cardboards andwooden pallets. Cardboard, if bundled and prepared for shipment, can be sold for $95 per ton. The plantestimates that it currently sends 2 tons of cardboard a day to the landfill. Preparing the cardboards will require one janitorial associate for 3 hours per day at a cost of $20 perhour. The baling equipment will cost $30,000 for installation, $45 per week to operate, $4500 per year to maintain, and last 12 years. The equipment will have a salvage value of $3000 at the end. Currently, 25,000 wooden pallets per year are scrapped each year because they are damaged or because they are not of the standard size used by the plant. The pallets average 13 pounds each. A pallet recycler has offered to purchase pallets, which are of certain sizes and in good condition. The pallets that are in these sizes and in acceptable condition amount to half the scrapped pallets. The pallet recycler is offering to pay $1.00 per pallet. Preparing the pallets in an acceptable form will require a cutting machine that will cost $12,000 for installation, $3000 per year to operate and three hours of labor per day. This job can also be done by a janitorial associate. The machine will have a useful lifeof 6 years and no salvage value at the end. Finally, purchasing has identified a company, that will pick up the damaged and unusablepallets and process them into wood chips, which this company then sells. The cost of this service is $1.25 per pallet. Using this information, find the best recycling strategy for the company among thefollowing options: Option 0: Status quo (no recycling) - Option 1: Recycling cardboards only Option 2: Recycling cardboards and usable wooden pallets (without selling the unusable pallets) Option 3: Recycling cardboards, usable and unusable wooden pallets | Instructions All answers should appear in the appropriate place in the template spreadsheet. 1) Transfer the appropriate information from above into the Excel worksheet (in cellsC5:C42) 1) Calculate the initial costs, annual savings, annual costs and salvage values using thegiven information for: a) Recycling cardboards only (in cells E15:H17) - Investment comes from the installation cost - Annual savings include cardboard sales + rebate from waste reduction (offered bythe landfill company) + savings from landfill and transportation (by not sending cardboard waste to landfill) - Annual costs include labor + operation + maintenance costs - Salvage value comes from the resale value of the baling equipment b) Recycling usable wooden pallets only (in cells E26:H28) - Investment comes from the installation cost - Annual savings include usable wooden pallet sales + rebate from waste reduction (offered by the landfill company) + savings from landfill and transportation (by not sending usable pallet waste to landfill) - Annual costs include labor + operation costs - Salvage value comes from the resale value of the cutting machine c) Selling unusable wooden pallets only (in cells E37:H39) - Investment is not applicable - Annual savings include rebate from waste reduction offered by the landfill company) + savings from landfill and transportation (by not sending unusablepallet waste to landfill) - Annual costs comes from the cost of service. - Salvage value is not applicable 2) Use Excel's PMTO function to calculate the annual worth of Option 1-3 (in cellsC46:C48) assuming that annual worth for Option 0 is equal to 0. Hint: Be careful with the sign convention of PMT function. 3) Make a recommendation for the best recycling strategy to the manager of The AcmeCorp. Problem Parameters MARR Weeks per year Days per week Rebate per ton per yer Container capacity in tons Landfill charge per ton Hauler charge per container Recycling Cardboards For Recycling Cardboards Investment Annual Savings Annual Costs Salvage Value Price per a ton of Cardboard Amount of Cardboard (in tons/year) Installation Cost Annual Labor Cost Annual Operating Cost Annual Maintenance Cost Annual Rebate (from Waste Reduction) Annual Savings from Landfill and Transportation Salvage Value (EOY12) Recycling Usable Pallets For Recycling Usable Wooden Pallets Investment Annual Savings Annual Costs Salvage Value Price per Usable Pallet Number of Usable Pallets (per year) Single Pallet Weight (lb) Installation Cost Annual Labor Cost Annual Operating Cost Annual Rebate (from Waste Reduction) Annual Savings from Landfill and Transportation Salvage Value (EOY6) Recycling Unusable Pallets Price per Unsable Pallet For Selling Unusable Wooden Pallets Number of Unusable Pallets (per year) Investment Annual Savings Annual Costs Salvage Value Single Pallet Weight (lb) Annual Service Cost Annual Rebate (from Waste Reduction) Annual Savings from Landfill and Transportation Annual Worths AW of Option 1 AW of Option 2 EAW of Option 3 (Recycling cardboards only) (Recycling cardboards + usable pallets) (Recycling cardboards + usable pallets + unusable pallets) Recommendation Which option do you recommend? 0