Capital budgeting � return-on-investment

Capital budgeting � return-on-investment -

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<Company Name> Capital budgeting—return-on-investment (ROI) analysis <Date> Data cell key User data entry or item description Formula cells: Totals are calculated and filled in automatically. Investment overview Cash flow and ROI statement BENEFIT DRIVERS YEAR 0 1 2 3 Greater margin driven by higher production capacity $500,000 $1,000,000 $1,250,000 Improved cycle time benefits: Reduced energy cost due to less running time 125,000 125,000 125,000 Reduced labor cost due to less running time 500,000 500,000 500,000 Fewer accidents, resulting in less workers' compensation 100,000 100,000 100,000 Improved quality benefits: Fewer defects, resulting in less rework 250,000 300,000 300,000 Fewer customer returns, resulting in less reprocessing costs 50,000 75,000 75,000 Reduced time spent handling customer complaints 50,000 75,000 75,000 <Benefit driver> <Benefit driver> <Benefit driver> <Benefit driver> Total annual benefits $1,575,000 $2,175,000 $2,425,000 Implementation filter 85% 90% 95% Total benefits realized
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This note was uploaded on 06/11/2011 for the course ACCT 210 taught by Professor Bou during the Spring '08 term at Maryland.

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Capital budgeting � return-on-investment -

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