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Do:Develop and implement a solution
Initial Cost of the I.S Software = $350,000,000 Maintenance Cost = $75,000,000 Cost of Capital = 10% NPV = $1,660,593,414,58
Years 2014 2015 2016 2017 2018 2019Cash Flow - I.T.
Software -350 000 000,00 0,00 0,00 85 000 000,00 245 000 000,00 405 000 000,00
Discounted Cash Flow -350 000 000,00 0,00 0,00 63 861 758,08 167 338 296,56 251 474 697,30
Cumulative Cash Flow -350 000 000,00 -350 000 000,00 -350 000 000,00 -286 138 241,92 -118 799 945,36 132 674 751,94
Years 2020 2021 2022 2023 2024 2025Cash Flow - I.T.
Software 565 000 000,00 565 000 000,00 565 000 000,00 565 000 000,00 565 000 000,00 565 000 000,00
Discounted Cash Flow 318 920 749,60 289 936 881,00 263 575 293,90 239 620 000,85 217 835 524,54 198 030 212,75
Cumulative Cash Flow 451 595 501,54 741 532 382,54 1 005 107 676,44 1 244 727
677,29 1 462 563 201,83 1 660 593 414,58
YearNumber of Workers in
Seattle
Number of Management in
Seattle
Number of workers in Training in
Seattle
Number of workers in Charleston
Number of Management in
Charleston
Number of Workers in Training
at Charleston
jan-14 1000,00 200,00 0,00 0,00 0,00 0,00jan-15 1000,00 200,00 250,00 0,00 0,00 0,00jan-16 1250,00 200,00 250,00 0,00 0,00 425,00jan-17 1500,00 150,00 0,00 425,00 50,00 425,00jan-18 1500,00 140,00 0,00 850,00 60,00 0,00jan-19 1500,00 130,00 0,00 850,00 70,00 0,00jan-20 1500,00 140,00 0,00 850,00 60,00 0,00jan-21 1500,00 140,00 0,00 850,00 60,00 0,00jan-22 1500,00 140,00 0,00 850,00 60,00 0,00jan-23 1500,00 140,00 0,00 850,00 60,00 0,00jan-24 1500,00 140,00 0,00 850,00 60,00 0,00jan-25 1500,00 140,00 0,00 850,00 60,00 0,00jan-26 1500,00 140,00 0,00 850,00 60,00 0,00jan-27 1500,00 140,00 0,00 850,00 60,00 0,00
Aircrafts Produced In Seattle $7 680 000 000,00Aircrafts Produced In Charleston $0,00Revenues $7 680 000 000,00Depreciation $100 000 000,00Production Work Pay $50 000 000,00Management Pay $20 000 000,00Fringe Benefits $48 000 000,00Supplier Parts $18 750 000,00Inventory $75 000 000,00Carrying Cost $5 000 000,00Overhead $36 000 000,00Cost of Training $11 250 000,00Cost of I.T. Software $350 000 000,00Penalty $7 411 200 000,00Total Cost $8 125 200 000,00Operating Income -$445 200 000,00
Aircrafts Produced In Seattle $9 600 000 000,00Aircrafts Produced In Charleston $0,00Revenues $9 600 000 000,00Depreciation $100 000 000,00Production Work Pay $62 500 000,00Management Pay $20 000 000,00Fringe Benefits $58 000 000,00Supplier Parts $23 437 500,00Inventory $93 750 000,00Carrying Cost $5 000 000,00Overhead $43 500 000,00Cost of Training $17 625 000,00Cost of I.T. Software $0,00Penalty $7 718 400 000,00Total Cost $8 142 212 500,00Operating Income $1 457 787 500,00
Aircrafts Produced In Seattle $11 680 000 000,00Aircrafts Produced In Charleston $1 960 000 000,00Revenues $13 640 000 000,00Depreciation $100 000 000,00Production Work Pay $75 000 000,00Management Pay $18 800 000,00Fringe Benefits $80 250 000,00Supplier Parts $33 300 781,25Inventory $133 203 125,00Carrying Cost $7 000 000,00Overhead $59 000 000,00Cost of Training $3 675 000,00Cost of I.T. Software $75 000 000,00Penalty $7 948 800 000,00Total Cost $8 534 028 906,25Operating Income $5 105 971 093,75
Aircrafts Produced In Seattle $11 840 000 000,00Aircrafts Produced In Charleston $5 720 000 000,00Revenues $17 560 000 000,00Depreciation $100 000 000,00Production Work Pay $75 000 000,00Management Pay $18 560 000,00Fringe Benefits $93 200 000,00Supplier Parts $42 871 093,75Inventory $171 484 375,00Carrying Cost $7 000 000,00Overhead $67 400 000,00Cost of Training $0,00Cost of I.T. Software $75 000 000,00Penalty $7 968 000 000,00Total Cost $8 618 515 468,75Operating Income $8 941 484 531,25
Aircrafts Produced In Seattle $12 000 000 000,00Aircrafts Produced In Charleston $7 680 000 000,00Revenues $19 680 000 000,00Depreciation $100 000 000,00Production Work Pay $75 000 000,00Management Pay $18 320 000,00Fringe Benefits $92 800 000,00Supplier Parts $48 046 875,00Inventory $192 187 500,00Carrying Cost $7 000 000,00Overhead $67 300 000,00Cost of Training $0,00Cost of I.T. Software $75 000 000,00Penalty $7 785 600 000,00Total Cost $8 461 254 375,00Operating Income $11 218 745 625,00
Aircrafts Produced In Seattle $12 160 000 000,00Aircrafts Produced In Charleston $7 840 000 000,00Revenues $20 000 000 000,00Depreciation $100 000 000,00Production Work Pay $75 000 000,00Management Pay $18 320 000,00Fring Benefits $92 800 000,00Supplier Parts $48 828 125,00Inventory $195 312 500,00Carrying Cost $7 000 000,00Overhead $67 300 000,00Cost of Training $0,00Cost of I.T. Software $75 000 000,00Penalty $7 526 400 000,00Total Cost $8 205 960 625,00Operating Income $11 794 039 375,00
Aircrafts Produced In Seattle $12 160 000 000,00Aircrafts Produced In Charleston $7 840 000 000,00Revenues $20 000 000 000,00Depreciation $100 000 000,00Production Work Pay $75 000 000,00Management Pay $18 320 000,00Fringe Benefits $92 800 000,00Supplier Parts $65 104 166,67Inventory $195 312 500,00Carrying Cost $7 000 000,00Overhead $67 300 000,00Cost of I.T. Software $75 000 000,00Penalty $7 296 000 000,00Total Cost $7 991 836 666,67Operating Income $12 704 000 000,00
Aircrafts Produced In Seattle $12 160 000 000,00Aircrafts Produced In Charleston $7 840 000 000,00Revenues $20 000 000 000,00Depreciation $100 000 000,00Production Work Pay $75 000 000,00Management Pay $18 320 000,00Fringe Benefits $92 800 000,00Supplier Parts $83 705 357,14Inventory $195 312 500,00Carrying Cost $7 000 000,00Overhead $67 300 000,00Cost of I.T. Software $75 000 000,00Penalty $7 104 000 000,00Total Cost $7 818 437 857,14Operating Income $12 896 000 000,00
Aircrafts Produced In Seattle $12 160 000 000,00Aircrafts Produced In Charleston $7 840 000 000,00Revenues $20 000 000 000,00Depreciation $100 000 000,00Production Work Pay $75 000 000,00Management Pay $18 320 000,00Fringe Benefits $92 800 000,00Supplier Parts $105 168 269,23Inventory $195 312 500,00Carrying Cost $7 000 000,00Overhead $67 300 000,00Cost of I.T. Software $75 000 000,00Penalty $6 768 000 000,00Total Cost $7 503 900 769,23Operating Income $13 232 000 000,00
Aircrafts Produced In Seattle $12 160 000 000,00Aircrafts Produced In Charleston $7 840 000 000,00Revenues $20 000 000 000,00Depreciation $100 000 000,00Production Work Pay $75 000 000,00Management Pay $18 320 000,00Fringe Benefits $92 800 000,00Supplier Parts $130 208 333,33Inventory $195 312 500,00Carrying Cost $7 000 000,00Overhead $67 300 000,00Cost of I.T. Software $75 000 000,00Penalty $6 480 000 000,00Total Cost $7 240 940 833,33Operating Income $13 520 000 000,00
Aircrafts Produced In Seattle $12 160 000 000,00Aircrafts Produced In Charleston $7 840 000 000,00Revenues $20 000 000 000,00Depreciation $0,00Production Work Pay $75 000 000,00Management Pay $18 320 000,00Fringe Benefits $92 800 000,00Supplier Parts $130 208 333,33Inventory $195 312 500,00Carrying Cost $7 000 000,00Overhead $67 300 000,00Cost of I.T. Software $75 000 000,00Penalty $6 259 200 000,00Total Cost $6 920 140 833,33Operating Income $13 740 800 000,00
