Question

Krill Electronics is looking for a new rental space for one of its manufacturing lines.

The first rental space, on Park Street, requires a 2-year lease with the total cost of the lease ($61750) due at the time of signing. The rental space has annual utilities of $23399. It will allow Krill to manufacture 39539 more units per year than it currently does at a profit of $2.97 per unit. If the unit is undamaged at the end of the 2-year lease, the rental company will return 2% of the initial lease amount.

Answer 1

The second rental space, on Boardwalk Avenue, requires a 6-year lease, with the total cost of the lease ($196328) due at the time of signing. The rental space has annual utilities of $29246. In this space, Krill will be able to manufacture 69552 more units per year than it currently does at a profit of $2.97 per unit. The larger space will require 3 more employees than the Park Street space at a cost of $38701 per employee per year.

Krill uses a MARR of 4% to evaluate financial decisions.

Answer 2

Other half of the quetion ^^^

Answer 3

currently working on it

Answer 4

So you're supposed to calculate the profit per year for each rental space ?

Answer 5

Using present worth analysis, what is the present worth of renting the space on Park Street?

Answer 6

Yes.. I think I know how to solve.. You can throw in your comments as you please.

Answer 7

OK, let me know what you find... if you want

Answer 8

For what ?

Answer 9

Yes, but how did you get that ? revenue - (annual utilities + lease/2) + 2%?

Answer 10

@retirEEd

Answer 11

Here is the solution.