Investment Analysis for Project A and Project B

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Investment Analysis for project A,,,,,, ,,,,,, Initial Investment ,,,,,, Cost,"830,000.00",,,,, Installation cost,"40,000.00",,,,, total investment,"870,000.00",,,,, ,,,,,, Summarized Profit an Loss Account for Product A,,,,,, year,0,1,2,3,4,5 Revenue (EBIT),,"250,000.00","270,000.00","300,000.00","330,000.00","370,000.00" Depriciation,,"174,000.00","174,000.00","174,000.00","174,000.00","174,000.00" EBIT,,"76,000.00","96,000.00","126,000.00","156,000.00","196,000.00" Tax @ 40%,,"30,400.00","38,400.00","50,400.00","62,400.00","78,400.00" PAT,,"45,600.00","57,600.00","75,600.00","93,600.00","117,600.00" ,,,,,, ,,,,,, ,,,,,, Computation of Net cash flow from Project A,,,,,, ,,,,,, Year,0,1,2,3,4,5 Investment,"-870,000.00",,,,, PAT,,"45,600.00","57,600.00","75,600.00","93,600.00","117,600.00" Depriciation,,"174,000.00","174,000.00","174,000.00","174,000.00","174,000.00" Net working capital,,"90,400.00","90,400.00","90,400.00","90,400.00","90,400.00" Net Operating Cash Flow,,"310,000.00","322,000.00","340,000.00","358,000.00","382,000.00" After tax value,,,,,,"240,000.00" Net Cash Flow,,"310,000.00","322,000.00","340,000.00","358,000.00","622,000.00" Present value factor @ 14%,1.0000,0.8772,0.7695,0.6750,0.5921,0.5194 Present Value,"-870,000.00","271,932.00","247,779.00","229,500.00","211,971.80","323,066.80" Net Present Value,"2,154,249.60",,,,, IRR,14%,,,,, Payback period,2 years + ((340000 - 238000)/340000 )*12,,,,, ,2years 3.6 months,,,,,

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