Applying Decision-Making Skills
As a manager, part of your role is to develop strategy, and share this strategy with various stakeholders within the organization. This assignment will allow you to take your findings as a manager and communicate these findings to those who are affected.
Your company has been presented with a decision on replacing a piece of equipment for a new computerized version that promotes efficiency for the upcoming year. As manager you will need to decide whether or not the purchase of the new equipment is a worthwhile investment and to communicate your recommendations to Executive Management for a final decision.
To be convincing, sufficient support for your recommendations must be provided in order to be considered valid and accepted.
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Existing Equipment
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Original Cost
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60,000
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Present Book Value
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30,000
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Annual Cash Operating Costs
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145,000
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Current Market Value
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15,000
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Market Value in Ten Years
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0
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Remaining useful Life
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10 years
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Replacement Equipment
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Cost
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600,000
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Annual Cash Operating Costs
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50,000
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Market Value in Ten Years
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0
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Useful Life
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10 years
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Other Information
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Cost of Capital
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10%
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Payback requirement
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6 years
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In this assignment, use the information above to develop a comprehensive analysis using NPV, Payback Method, and IRR to develop a recommendation on replacing the existing equipment with a new computerized version. Develop an executive summary of your findings in a Microsoft PowerPoint presentation format to present to Executive Management.
Do the following in your presentation:
- Include a statement of the problem or topic, a concise analysis of the findings, and a recapitulation of any main conclusions or recommendations.
- Besuretoincorporatespecificdetailstohighlightorsupportthesummaryincludingcalculations.
Develop a 8-10 slide presentation in PowerPoint format. Apply APA standards to citation of sources.