The MRI Trailer costs $600,000 and has an expected life of 5 years with an estimated salvage value of $200,000 at that time. After some extensive research, the numbers we have come up with look like this:15 tests per day for 250 days per year for each year of the projects lifeEach procedure is expected to generate $80 in cash collections during the first year of use (Net revenue for year 1 is 15*250*80=$300,000)Labor and Maintenance costs are expected to be $100,000 during the first yearUtilities will cost $10,000 in year one and there is an incremental overhead increase of $5,000 beginning in year oneCost for expendable supplies is expected to be $5 per procedureCosts and revenues are expected to increase at a 5% inflation rateOur corporate cost of capital is 10%
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