Determine a suitable time for replacing the car

Assignment Help Basic Statistics
Reference no: EM131754564

Question: An organisation has recently purchased a company car for one of its senior managers at a cost of £25 000 and is trying to determine the most suitable time for replacement. It is estimated that the car will depreciate by £5000 in the first year, £2000 in each of the next two years and £3000 in each of the next two years. Running costs in the first year are estimated at £5000 and are estimated to increase by 15 per cent per annum thereafter.

(a) Determine a suitable time for replacing the car.

(b) The company has a capital cost for such projects of 5 per cent per annum and expects inflation to average 2 per cent per annum over the foreseeable future. Using present-value techniques determine a suitable replacement time for the vehicle.

Reference no: EM131754564

Questions Cloud

Continuing existence of the company : BUSI 561 - How would you respond if you were running such a company and Profit and return on investment for company owners/shareholders o Continuing existence
Discuss how well you think starbucks tuition reimbursement : Discuss how well you think Starbucks tuition reimbursement program meets the criteria for selecting employee benefits.
Prepare transactions to record these events : REQUIRED: Prepare transactions to record these events in internal service fund. If no entry is required, write "No entry required"
Identify approach for the type of accounting change : Identify the approach for the type of accounting change indicated:
Determine a suitable time for replacing the car : An organisation has recently purchased a company car for one of its senior managers at a cost of £25 000 and is trying to determine the most suitable time.
Determine the break-even point for each range : Determine the break-even point for each range. how many machines should be purchased?
Discuss the lifo method of inventory valuation : From the LIFO method of Inventory Valuation to the FIFO method
Analyze the roles and responsibilities of financial managers : Analyze the roles and responsibilities of financial managers in confirming compliance with federal and shareholder requirements.
Affect the supply chain in apparel manufacturing industry : How does the way we produce and consume energy affect the supply chain in apparel manufacturing industry?

Reviews

Write a Review

Basic Statistics Questions & Answers

  A discrete random variable x can assume 5 possible values 2

a discrete random variable x can assume 5 possible values 2 4 6 7 and 9. its probability distribution is shown

  Products manufactured by nanuq australia

A large retailer (in Sydney) that sells products manufactured by Nanuq Australia needs to develop an inventory policy for electric heaters. The annual demand for the electric heaters is 3,000 (A) units. Each unit costs the retailer $50 (c) with ho..

  Cookie sales at a bakery follow a normal distribution with

cookie sales at a bakery follow a normal distribution with expected value of 10000 cookies. on 90 percent of days the

  Perform a hypothesis test to see if there is no difference

a researcher in colorado is trying to improve plant growth. they want to see how combinations of different brands of

  Assume that the given procedure yields a binomial

assume that the given procedure yields a binomial distribution with n trials and the probability of success for one

  According to experian the population of consumer credit

according to experian the population of consumer credit card holders carries an average credit card balance of 5500

  Find a rule for the number of items that should be stocked

This is a simplified inventory problem. Suppose that it costs c dollars to stock an item and that the item sells for s dollars.

  1an experiment was performed to investigate lifetime of a

1.an experiment was performed to investigate lifetime of a component exposed to high heat. three different oven types

  Create confidence interval for mean monthly sales

Their mean monthly sales were $10,000 with a standard deviation of $1000. Construct a 95% confidence interval for the population mean.

  A motor drives a flexible structure

When a motor drives a flexible structure, the structure's natural frequencies, as compared to the bandwidth of the servo drive, determine the contribution of the structural flexibility to the errors of the resulting motion.

  Define that the machine needs an adjustment

Using the 5% significance level, can you conclude that the machine needs an adjustment? Assume that the diameters of all ball bearings have a normal.

  What is the probability that the total value of all coins

Suppose we flip two pennies, three nickels, and four dimes. What is the probability that the total value of all coins showing heads is equal to $0.31?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd