Hj heinz corporation is constructing a distribution


HJ Heinz Corporation is constructing a distribution facilityin Italy for products such as Heinz Ketchup, Jack Daniel's Sauces,HP steak sauce, and Lea & Perrins Worcestershire sauce. A15-year life is expected for the structure. The exterior of thebuilding is not yet selected. One alternative is to use theconcrete walls as the facade. This will require painting now andevery 5 years at a cost of $80,000 each time. Another alternativeis an anodized metal exterior attached to the concrete wall. Thiswill cost $200,000 now and require only minimal maintenance of $500every 3 years. A metal exterior is more attractive and will have amarket value of an estimated $25,000 more than concrete 15 yearsfrom now. Assume painting (concrete) or maintenance (metal) will beperformed in the last year of ownership to promote selling the property. Use future worth analysis and i = 12% per yearto select the exterior finish.

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Civil Engineering: Hj heinz corporation is constructing a distribution
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