Software project decision

Title: Project Management

Subtitle: https://opentextbc.ca/projectmanagement/

ISBN: 978-1-77420-013-1

Authors: Adrienne Watt

Publisher: BCcampus

Publication Date: August 14, 2014

Edition: 2nd Edition

Minimum of 7 outside references plus the book refernce 

Software project decision point.

You need to determine an interest rate to use—select an interest rate and explain why you think this number should be used. Use it in your calculations in item 1.2.

Given the information below on options 1 and 2, carry out three forms of analysis: breakeven, ROI, and NPV.

Make a recommendation on which way to proceed, based on the TCO for each option.

Option 1: Purchase the FunSoft package: Cost $200,000 for software and $85,000 for hardware in year one; with $50,000 to customize it and a $40,000 annual licensing fee for the life of the contract. There will be an annual saving of $61,000 due to the layoff of a clerk.

Option 2: Purchase the SoftComm package, which will operate on the vendor’s hardware: Cost $250,000 for a five-year license, payable half up front and half during the first year of implementation. The maintenance contract, at $75,000 a year, includes all currently identified modifications to the software for the first three years. The clerk’s hours will be cut by half, for a saving of $25,000 a year.

In both cases, sales are expected to increase from the current $1 million a year, by 10% per year each year (over each year’s previous year’s sales) after full implementation.

Assume a five-year life for the software.

For a Good work,

Use the integration of content and external material on Project Initiation, Overview of Project Planning, for the calculations of Returns on Investment, Net Present Value, and Total Cost of Ownership to compare projects.

Assignment Requirements

1. Good Main heading

2. Good introduction paragraph

3. Good Subheadings

4. State the formula distinctively.

5. Calculate for Option 1-FunnSoft Venture and The annual saving of $61,000 to Year 5

6. Calculate for Option 2-SoftComm Venture and The annual saving of $25,000 to Year 5

7. Define all acronyms from the onset

8. Label all Tables and Diagrams

9. Explain all Tables/diagrams in the text.

10. Good Conclusion

11. Fair in-text citations and References