Year Investment Cash Inflow $13,000 $10,000 $1,000 $2,000 $2,500 $4,000 $5,000 $4,000 $5,000 $4,000 $3,000 $2,000 1 3. 7 8 9. 10 Determine the Payback Period.
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- How do you calculate the NPV and IRR Project 1 Year Cashflows Discount Rate 10% 0 $ (750,000.00) 1 $ 250,000.00 2 $ 300,000.00 3 $ 350,000.00 4 $ 200,000.00 5 $ 100,000.00 Project 2 Year Cashflows Discount Rate 10% 0 $ (1,000,000.00) 1 $ 200,000.00 2 $ 300,000.00 3 $ 400,000.00 4 $ 500,000.00 5 $ 700,000.00Project A has the following information: Year 0 1 2 3 4 5 Initial investment outlay 125,000 Cash inflows 75,000 80,000 95,000 95,000 86,250 Personnel expenses 22,500 22,500 22,500 22,500 22,500 Material expesnes 15,000 20,000 22,500 22,500 22,500 Maintenance expenses 2,500 2,500 5,000 8,750 10,000 Other cash outflows 3,750 3,750 3,750 5,000 5,625 Liquidation value 12,500 Project B has the following information: Year 0 1 2 3 4 5 Initial investment outlay 225,000 Cash inflows 155,000 140,000 108,750 93,750 125,000 Personnel expenses 27,500 27,500 27,500 27,500 27,500 Material expenses 25,000 22,500 22,500 22,500 24,000 Maintenance expesnses 8,750 11,250 17,500 15,000 14,000 Other cash outflows 6,250 3,750 3,750 3,750 4,000 Liquidation value 15,000 The Discount Rate is 8%Assess the relative profitability of the two options using the following methods:(i) The Annuity Method(ii) The Net…PROJECT A PROJECT BInitial Outlay -60,000 -80,000Inflow year 1 17,000 18,000Inflow year 2 17,000 18,000Inflow year 3 17,000 18,000Inflow year 4 17,000 18,000Inflow year 5 17,000 18,000Inflow year 6 17,000 18,000
- I wish for a detailed answer. thank you A project is estimated to cost $248,400 and provide annual net cash inflows of $50,000 for 8 years. Year 6% 10% 12% 1 0.943 0.909 0.893 2 1.833 1.736 1.690 3 2.673 2.487 2.402 4 3.465 3.170 3.037 5 4.212 3.791 3.605 6 4.917 4.355 4.111 7 5.582 4.868 4.564 8 6.210 5.335 4.968 9 6.802 5.759 5.328 10 7.360 6.145 5.650 Determine the internal rate of return for this project, using the above present value of an annuity table.fill in the blank 1 %The goodwill of Blue Devil Inc. is $1,200,000. What’s the amortization expense per year? Group of answer choices $100,000 Do not do amortization $1,200,000 $1The project's IRR? Year 0 1 2 3 4 5 Cash flows -$8,750 $2,000 $2,025 $2,050 $2,075 $2,100
- 7 Present work in Excel Consider the following: Financed amount: $385,000 Cost of funds: 7.25% (interest rate) 30-year amortization Calculate (round to nearest dollar): Annual payment amount (this is monthly payment x 12 --- then rounded to nearest dollar) Amount of 'Interest paid' during year 3 (rounded to nearest dollar) Amount of 'Principal paid' during year 3 (rounded to nearest dollar)The following details are provided by Ferrous Foundry Company: Initial investment $5,020,000 Discount rate 15% Yearly cash inflows 1 $1,254,000 2 $1,360,000 3 $2,402,000 4 $1,166,000 PV of $1: 13% 14% 15% 1 0.885 0.877 0.87 2 0.783 0.769 0.756 3 0.693 0.675 0.658 4 0.613 0.592 0.572 What is the NPV of the project? A. $617,424 B. $(653,392) C. $(594,032) D.592,360Cost of new equipment: $200,000 Installation: $20,000 Change in Net Operating Working Capital: $50,000 New sales per year: $115,000 New operating costs per year: $50,000 Economic life: 4 years Depreciable life: MACRS 3-year class (33%, 45%, 15%, 7%) Salvage value: $20,000 Tax Rate: 25% WACC: 9% What is the total initial investment outlay (FCF0)? What is the operating cash flow for year 2, or FCF2? (SHOW ALL WORK/STEPS) What are the planned non-operating cash flows in year 4 (i.e. terminal cash flows)? (SHOW ALL WORK/STEPS) What is the book value of the equipment after three years?
- Christopher Company borrowed $6 million at 11% on January 1, 2020, to build a new building. The building is expected to take 18 months to complete. Christopher invests the money from the project until it is needed for construction. He is currently earning 10%. The following is the expenditures as they relate to the construction of the building.January 1$1,500,000April 1$1,850,000October 1$1,100,000December 31$1,000,000Required: 2. Compute the amount of interest revenue Christopher would recognize.Christopher Company borrowed $6 million at 11% on January 1, 2020, to build a new building. The building is expected to take 18 months to complete. Christopher invests the money from the project until it is needed for construction. He is currently earning 10%. The following is the expenditures as they relate to the construction of the building.January 1$1,500,000April 1$1,850,000October 1$1,100,000December 31$1,000,000 1. Compute the amount of interest expense Christopher would capitalize. 2. Compute the amount of interest revenue Christopher would recognize.2020 2019 2018 $,000 $,000 $,000 EBIT -741,819 734,312 1,038,864 Depreciation 606,975 485,625 467,050 Tax 129,735 196,548 208,948 Operating Cash Flow -264,579 1,023,389 1,296,966 New fixed assets 14,836,508 14,884,523 14,986,813 Old fixed assets 14,884,523 14,986,813 14,236,644 Depreciation 606,975 485,625 467,050 Net Capital Spending 558,960 383,335 1,217,219 New current assets 10,347,686 6,922,405 6,504,962 Old current assets 6,922,405 6,504,962 7,898,431 New current liability 4,964,164 2,913,926 3,120,099 Old current liabilaty 2,913,926 3,120,099 3,485,129 Change in Net Working Capital 1,375,043 623,616 -1,028,439 Cash Flow From Assets -2,198,582 16,438 1,108,186 Briefly comment the free cash flow of this company
