Week3_Amra_Besirevic_Pine Valley Furniture Case Study

Week3_Amra_Besirevic_Pine Valley Furniture Case Study -...

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Pine Valley Furniture Case Study Customer Tracking System Project (Part A) Pine Valley Furniture projects were initiated by submitting a system service request, and therefore requesting development of Customer Tracking System which is mainly planned. Pine Valley Furniture WebStore project was planned by the by Board of Directors.
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Pine Valley Furniture Case Study Customer Tracking System Project (Part B) Discount Rate: 10.0% 0 1 2 Net Economic Benefit $0 $50,000 $50,000 Discount rate (10%) 1.0000 0.9091 0.8264 PV of benefits $0 $45,455 $41,322 NPV of all BENEFITS $0 $45,455 $86,777 One-time COSTS ($47,500) Recurring Costs $0 ($32,000) ($32,000) Discount rate (12%) 1.0000 0.9091 0.8264 PV of Recurring Costs $0 ($29,091) ($26,446) NPV of all COSTS ($47,500) ($76,591) ($103,037) Overall NPV Overall ROI - (Overall NPV / NPV of all COSTS) Break-even Analysis Yearly NPV Cash Flow (PV Benefits + PV Costs) ($47,500) $16,364 $14,876 Overall NPV Cash Flow (NPV Benefits + NPV Costs) ($47,500) ($31,136) ($16,260) Project break-even occurs between years 3 and 4
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This note was uploaded on 03/28/2010 for the course BTM 431 taught by Professor Edgrin during the Spring '10 term at DeVry Denver.

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Week3_Amra_Besirevic_Pine Valley Furniture Case Study -...

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