Positive, but barely. HA520's Unit 8 capital budgeting evaluation finds a [$3.5] million second MRI clearing a [7] percent hurdle by [$221,776], then failing if volume runs [3.2] percent short. Searches like "ha 520 unit 8 assignment example", "ha520 unit 8 sample" and "ha520 unit 8 example" land here.
What a finished HA520 Unit 8 capital budgeting evaluation looks like
Five pages carry a schedule, a sensitivity panel and, first, the assumptions: scanner [$2.4] million and room shielding [$1.1] million, incremental scans of [2,400], [3,000] and then [3,300] a year, net revenue of [$486] and variable cost of [$64] per scan, [4.0] technologist FTEs costing [$487,469] a year fully loaded, a service contract of [$190,000] from year two, and salvage of [$250,000]. Because the hospital is tax-exempt, no tax line appears. The schedule runs from [$525,331] of net cash in year one to [$715,131] at maturity. A boxed line gives net present value [$221,776], internal rate of return [8.6] percent, payback in [5.3] years. A sensitivity panel reprices the project at a [9] percent rate, at [80] percent of volume and at a [10] percent lower payment per scan; all three turn negative.
How a HA520 Unit 8 example is structured
The evaluation moves from the request to the numbers to the decision. It opens with the operating case in one paragraph: a [19]-day wait for an outpatient MRI and referrals leaving for a freestanding center. Assumptions follow in a numbered list, each with its source, so any cash flow can be traced. Incremental reasoning is explicit: only scans the hospital would otherwise lose are counted, never scans moved from the existing magnet. The cash flow schedule comes next, then the three decision measures, a sentence each on what they mean. Discounting is explained once, with the [7] percent rate tied to the hospital's borrowing cost and investment return. The sensitivity panel and a break-even volume of about [3,196] scans a year form the longest section. Regulatory timing, including certificate of need review where a state requires it, precedes the recommendation.
A wait list as the business case
[19] days to an outpatient MRI and referrals drifting to a freestanding center, stated as the problem the scanner is meant to solve.
Only the scans otherwise lost
Incremental volume counted from captured referrals, with scans shifted off the existing magnet excluded so revenue the hospital already has is never claimed twice.
Seven years of cash
Net inflows from [$525,331] to [$715,131], salvage of [$250,000] in the final year, and no tax line because the hospital is exempt.
Three measures, one reading
Net present value of [$221,776], an internal rate of [8.6] percent and payback in [5.3] years, each interpreted against the [7] percent rate.
How little it takes
Volume [3.2] percent under forecast, a [9] percent discount rate or a [10] percent lower payment each push net present value below zero.
Approval with conditions
Final approval tied to signed referral commitments and a volume checkpoint, with extended evening hours on the current scanner named as the fallback.
Where marks go in HA520 Unit 8
Evaluations reporting a positive net present value and recommending purchase, with no sensitivity work, get the arithmetic right and the judgment wrong; on a project this thin, the fragility is the finding. Revenue that counts every scan on the new magnet, including scans moved from the old one, overstates the case and draws heavy deductions in this unit. An unexplained discount rate, or tax deducted for a tax-exempt hospital, signals a borrowed template. Missing salvage or service contract lines make cash flows look cleaner than they are. Payback reported alone ignores time value, the concept the unit exists to teach. A recommendation stating what would change it tends to score well. Leaving regulatory approval out entirely misses a timing risk that hospitals in certificate of need states cannot set aside.
Get a HA520 Unit 8 example written to your instructions
The Unit 8 project details, capital cost, volume forecast, payment rates and whatever discount rate the case supplies, go in with the instructions and rubric. An evaluation returns in 24-48h with every assumption listed, all three decision measures computed and a sensitivity panel testing how firm the answer is. The first one is free.
HA520 Unit 8 questions, answered
Why is there no tax line in the cash flows?
Because the composite hospital is a tax-exempt nonprofit, so depreciation creates no tax shield and operating cash flows are not reduced by income tax. Many finance textbooks build capital budgeting around taxable firms, and papers copy that structure without noticing. If your case describes an investor-owned hospital, taxes and the depreciation shield return and the schedule gains two lines.
How is a discount rate chosen for a nonprofit hospital?
Usually from its cost of capital: the interest rate on its tax-exempt debt blended with the return its invested funds would otherwise earn, sometimes raised for riskier projects. The example uses [7] percent and explains it in two sentences. If your case supplies a rate, use it; if not, state the reasoning, because an unexplained rate undermines every result depending on it.
What is certificate of need, and does every state require it?
Certificate of need laws require state approval before certain health care facilities add major equipment, beds or services. Many states run such programs, others have repealed or narrowed them, and the covered equipment differs from state to state. The example treats approval as a possible timing risk rather than assuming it applies; your case's state decides the question.