Read Case 3: AMD Construction in the text (pg. 448-450) and answer the following questions in a 3-4 page paper, justifying your conclusions. Your paper should have at least two scholarly sources, in addition to the textbook, and be formatted according to APA style as outlined in the Ashford Writing Center.
- Discuss the various steps in the capital equipment acquisition process.
- Develop a comprehensive analysis of the negotiations between Jane Axle and Tom Reed. (Provide a chart to show financial impacts.)
- What is your assessment of the negotiations process, given what you have studied? What are your recommendations for Mr. Reed?
~Suggestion of format for analysis:
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Current Machine |
CAT-1 machine-purchase |
CAT-1 machine – Lease |
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Operating cost (without operators) |
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Direct Labor |
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Depreciation (straight line) 4 months |
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Lease Expense 4 Months |
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Interest expense at 8% for 4 months |
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Salvage Value after 3 years |
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Unexpected Costs |
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Totals |
