THE FINANCIAL JUSTIFICATION PROCEDURE FOR PURCHASING MAJOR CAPITAL EQUIPMENT IS PRESENTED. THE EXAMPLE USED IS EVALUATING THE PURCHASE OF A SLITTING LINE FOR A TUBING PRODUCER. SPECIFICATIONS FOR THE INCOMING AND PRODUCT COILS ARE ANALYZED, AND FROM THAT ANALYSIS THE REQUIREMENTS FOR THE SLITTING LINE ARE ESTABLISHED. NEXT, TOTAL PROJECT COSTS ARE PREPARED AND COMPARED WITH THE PRICES OTHER FIRMS CHARGE FOR PERFORMING THE SAME WORK TO DETERMINE THE PROFIT POTENTIAL FOR THE NEW EQUIPMENT.
| Number of Pages : | 11 |
| Published : | 06/01/1991 |
