Land opportunity cost, accounting assignment help

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Land opportunity cost

(500,000)

Building

(10,000,000)

Net revenues

3,750,000

3,862,500

3,978,375

4,097,726

4,220,658

Less labor cost

800,000

824,000

848,720

874,182

900,407

Utilities

50,000

51,500

53,045

54,636

56,275

Supplies

1,500,000

1,545,000

1,591,350

1,639,091

1,688,263

Incremental overhead

36,000

37,080

38,192

39,338

40,518

Net income

1,364,000

1,404,920

1,447,068

1,490,480

1,535,194

Plus : net land salvage value

500000

Plus : net bldng/eqp value

3000000

Net cash flow

(10,500,000)

1,364,000

1,404,920

1,447,068

1,490,480

5,035,194

best case

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4

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Land opportunity cost

(500,000)

Building

(10,000,000)

Net revenues

6,250,000

6,437,500

6,630,625

6,829,544

7,034,430

Less labor costs

800,000

824,000

848,720

874,182

900,407

Utilities

50,000

51,500

53,045

54,636

56,275

Supplies

2,500,000

2,575,000

2,652,250

2,731,818

2,813,772

Incremental overhead

36,000

37,080

38,192

39,338

40,518

Net income

2,864,000

2,949,920

3,038,418

3,129,570

3,223,457

Plus : net land salvage value

500000

Plus : net building/equipment value

7000000

Net cash flow

(10,500,000)

2,864,000

2,949,920

3,038,418

3,129,570

10,723,457