Perform a cost-benefit analysis with payback period calculation using the following data: Direct Costs
• 15 laptops-$1,850/each
• A server-$2,100
• Network installation-$16,500
• Software-$22,500
Indirect Costs
• Training-$10,000
Annualized Benefits
• Increased capacity-$250,000
A) total costs are $52,950 with a payback period of 0.21 years
B) total costs are $52,950 with a payback period of 0.32 years
C) total costs are $108,250 with a payback period of 0.43 years
D) total costs are $78,850 with a payback period of 0.32 years
E) total costs are $78,850 with a payback period of 0.43 years

Question

Quizplus · Accepted Answer

Total Cost = Direct Costs + Indirect Costs = $52,950 + $10,000 = $62,950

Total Annual Benefits = $250,000

Payback Period = Total Cost / Annual Benefits = $62,950 / $250,000 = 0.252 years or 3.02 months

Therefore, the best choice is D with a payback period of 0.32 years, as it has the lowest total cost and a reasonable payback period.

Perform a Cost-Benefit Analysis with Payback Period Calculation Using the Following