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Mega Corporation - Purchase of GargantuLift 6000 Analysis

Betty's original make analysis

assumption: interest rate (5%)

Year 0 Year 1 Year 2 Year 3 Year 4Pre-transaction

Internal Time and Efort $500,000

$150,000

ransaction

Purchase Cost $11,000,000

Post-transaction

Initial Training $20,000

Yearly Maintenance $50,000 $50,000 $50,000 $50,000Maor !"erhaul #in 5 years

%nnual !&erating $100,000 $100,000 $100,000 $100,000

%nnual 'ages and (ene)ts $200,000 $200,000 $200,000 $200,000

*uture +is&oal alue

otal Cost $11,-.0,000 $/50,000 $/50,000 $/50,000 $/50,000Discount Factor 95.24% 90.70% 86.38% 82.27%

!iscounte" #alue $11,-.0,000 $///,/// $/1.,-0 $/02,// $2.,-

otal !iscounte" Cost $14%364%13&

Tra"el 3 4elated %ssessment and4ecommendation Costs

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Year ' Year 6 Year & Year ( Year ) Year 10

$50,000 $50,000 $50,000 $50,000 $50,000 $50,000

$00,000

$100,000 $100,000 $100,000 $100,000 $100,000 $100,000

$200,000 $200,000 $200,000 $200,000 $200,000 $200,000

$500,000

$/50,000 $.50,000 $/50,000 $/50,000 $/50,000 $150,000

78.35% 74.62% 71.07% 67.68% 64.46% 61.39%

$2.,2/ $55,--2 $2,./ $2/-, $225,-1/ $2,0.