using the data provided above, calculate the NPV of the TCO for the buyer's decision using a 10 percent discount rate.

1) A buyer for a frozen yogurt franchise with 145 stores is responsible for all the asset purchases at her company. She has decided to upgrade the equipment of her outlet by ter, they will last for the next eight years. She is considering a quote from a supplier installing new cash registers. She believes that if she purchases the latest cash regis who agreed to supply the cash registers for $1.050 per register. The buyer wants to order one register for each store (145 registers. Along with the registers, she also decided to buy two add-ons for each register credit card machine and an automatic coin dis penser. The two accessories would cost her an additional S120 and SI85 per register As with any purchase of new equipment, support would be required to maintain the equipment. The buyer decided to purchase an eight-year warranty, which would cost $200 per register. She also estimated that she will need to spend money to link the register to the computer system, which would cost S110 per quarter per register and an additional $160 every six months per register for maintenance. The buyer will need to pay a one-time upfront training charge of S100 per register to train the outlet managers. She also consid- PROBLEMS UCT COST OF OWNERSHIP As an alternative, you can produce the lenses at your own factory, but the form of cashing people out must be used). She estimated the downtime to be 12 hours per register per year, and the cost to be $55 per hour. She was confident that the high-end registers would have a salvage value of S120 per register at the end of their life. As she was calculating the cost, she suddenly realized that there were other costs related to the purchase. The cost to install the registers was $380 per register. She cal- culated that finalizing the sourcing contract for the registers, security service, and other costs would take the work of 2 full-time equivalent people working in the purchasing department exactly 30 days of each person's time. She thought that she would need the help of a sourcing manager who makes a total salary of $160,000 per year and an assis- tant who earns $105,000 per year. They would place an initial purchase order, which would cost the company S275 and each year they would submit 6 invoices at an estimat of 553 cach for the register service costs. a) Using the data provided above, calculate the NPV of the TCO for the buyer's decision using a 10 percent discount rate. b) Where should the buyer focus her efforts to reduce the TCO? 2) You are a buyer for Clinique Corporation, which is considering adding a new lens their product line of digital cameras. A Dutch supplier produces these lenses and you considering buying them from that company. The supplier wants to bid on your or You told him that your demand would be 23,000 units, 36,000 units, 58,000 units 76,000 units in years 1, 2, 3, and 4, respectively, and he has offered you a competi price of $80 per unit. As you think through the offer, you also anticipate that the ping charges would be 53.25 per unit and import/custom charges would be $7.50 unit. In addition to these costs, there would also be administrative costs, which w amount to $4,200 per month to purchase the lenses. red with this option as well. Raw materials would cost $23