Feasibility Analysis of Overhaul and Modernization of Equipment

DOI

10.2991/iscfec-18.2019.228How to use a DOI?

Keywords

Overhaul of Equipment, Modernization of Equipment, Enterprise Value, Market Value, Feasibility Analysis, Incremental Indicators, Enterprise Economic Opportunities.

Abstract

Overhaul and modernization of equipment directly affect its market value and require significant investments which feasibility needs to be checked. This article analyzes the factors that influence the expediency of equipment overhaul or modernization. The economic effect of repair or modernization is the equipment market value increase and enterprise value change. The equipment market value increase as a result of overhaul and modernization is not the only determining condition of implementation economic feasibility. Firstly, to make an optimal choice between overhaul and modernization of old equipment and the purchase of a new one, it is necessary to com-pare the economic effect of possible repairs with the amount of costs that will be required in the event of this repair. Secondly, you should consider the possibility of acquiring such equipment, either new or used, but in good condition. The author of the article proposes to compare the cost of replacing objects with the amount of overhaul and modernization cost and to analyze incremental indicators. In general, the economic effect that can be achieved after equipment overhaul and modernization is compared with its cost and considered as an element of business change value. This method can help to analyze whether capital repairs and modernization are beneficial, taking into account the enterprise economic and financial opportunities.

Copyright

© 2019, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

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TY  - CONF
AU  - N.A. Shcherbakova
PY  - 2019/01
DA  - 2019/01
TI  - Feasibility Analysis of Overhaul and Modernization of Equipment
BT  - Proceedings of the International Scientific Conference "Far East Con" (ISCFEC 2018)
PB  - Atlantis Press
SP  - 1006
EP  - 1010
SN  - 2352-5428
UR  - https://doi.org/10.2991/iscfec-18.2019.228
DO  - 10.2991/iscfec-18.2019.228
ID  - Shcherbakova2019/01
ER  -