Negotiation

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AMD Construction and Negotiation

Read Case 3: AMD Construction in the text (pg. 448-450) and answer the following questions in a three- to -four page, APA formatted paper:

  1. Discuss the various steps in the capital equipment acquisition process.
  2. Develop a comprehensive analysis of the negotiations between Jane Axle and Tom Reed. (Provide a chart to show financial impacts.)
  3. What is your assessment of the negotiations process, given what you have studied?  What are your recommendations for Mr. Reed?  You must justify your conclusions.

Suggestion of format for analysis:

 

Current Machine

CAT-1 machine-purchase

CAT-1 machine - Lease

Operating cost

(without operators)

 

 

 

Direct Labor

 

 

 

Depreciation

(straight line) 4 months

 

 

 

Lease Expense 4 Months

 

 

 

Interest expense

at 8% for 4 months

 

 

 

Salvage Value after 3 years

 

 

 

Unexpected Costs

 

 

 

Totals

 

 

 

 

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