Please see attached information. Is there a way to show the breakout of the straight line depreciation method in Excel? And any other assistance is much appreciated. Notes:1. Yards sold and price per yard would be fixed by contract.2. Cost of goods includes fixed cost of $300,000 per year plus variable costs of S18 per yard. Costs are expected to increase at the inflation rate of 4% per year.3. Depreciation: A SI million investment in machinery is depreciated straight-line over 5 years (S200,000 per year). The S500,000 cost of refurbishing the Pleasantboroplant is depreciated straight-line over 10 years ($50,000 per year).Armed with this information, Mr. Tar constructed a spreadsheet to calculate the NPV of the duffel canvas project, assuming thatSheetbend's bid would be accepted by the navy.He had just finished debugging the spreadsheet when another confidential envelope arrived from Sheetbend's CEO. It contained a firmoffer from a Maine real estate developer to purchase Sheetbend's Pleasantboro land and plant for $1.5 million in cash.Should Mr. Tar recommend submitting the bid to the navy at the proposed price of $30 per yard? The discount rate for this project is 12%. rage JuzMINICASEJack Tar, CFO of Sheetbend & Halyard Inc., opened the internal company confidential envelope. It contained a draft of a competitive bidfor a contract to supply duffel canvas to the U.S. Navy. The cover memo from Sheetbend's CEO asked Mr. Tar to review the bid before itwas submitted.The bid and its supporting documents had been prepared by Sheetbend's sales staff. It called for Sheetbend to supply 100,000 yards ofduffel canvas per year for 5 years. The proposed selling price was fixed at $30 per yard.Mr. Tar was not usually involved in sales, but this bid was unusual in at least two respects. First, if accepted by the navy, it would commitSheetbend to a fixed-price, long-term contract. Second, producing the duffel canvas would require an investment of $1.5 million topurchase machincry and to refurbish Sheetbend's plant in Pleasantboro, Maine.Mr. Tar set to work and, by the end of the week, had collected the following facts and assumptions:• The plant in Pleasantboro had been built in the early 1900s and is now idle. The plant was fully depreciated on Sheetbend's books,except for the purchase cost of the land of $10,000.• Now that the land was valuable shorefront property, Mr. Tar thought the land and the idle plant could be sold, immediately or in thenear future, for $600,000.• Refurbishing the plant would cost $500,000. This investment would be depreciated for tax purposes straight-line over 10 years.• The new machinery would cost $1 million. This investment could be depreciated straight-line over 5 years.• The refurbished plant and new machinery would last for many years. However, the remaining market for duffel canvas was small, and itwas not clear that additional orders could be obtained once the navy contract was finished. The machinery was custom-built and couldbe used only for duffel canvas. Its secondhand value at the end of 5 years was probably zero.L Table 9.2 shows the sales staff's forecasts of income from the navy contract. Mr. Tar reviewed this forecast and decided that itsassumptions were reasonable.• But the forecast income statement contained no mention of working capital. Mr. Tar thought that working capital would average aboutTable 9.2 Forecast income statement for the U.S. Navy duffel canvas project (dollar values in thousands, except price per yard)Year:1231. Yards sold100.00100.00100.00100.00100.002. Price per yard30.0030.0030.0030.0030.003,000.003.000.003.000.003,000.003,000.003. Revenue (1 x 2)4. Cost of goods sold2,100.002,184.002,271.362,362.212,456.70900.00816.00728.64637.79543.305. Operating cash flow (3 - 4)6. Depreciation250.00250.00250.00250.00250.007. Income (5 - 6)650.00566.00478.64387.79293.308. Tax at 30%195.00169.80143.59116.3487.999. Net income (7 - 8)$455.00$396.20$335.05$271.45$205.31

Name: Please see attached information. Is there a way to show the breakout
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Description: Please see attached information. Is there a way to show the breakout of the straight line depreciation method in Excel? And any other assistance is much appreciated. Notes:1. Yards sold and price per yard would be fixed by contract.2. Cost of goods

Question

Please see attached information.  Is there a way to show the breakout of the straight line depreciation method in Excel? And any other assistance is much appreciated. Notes:1. Yards sold and price per yard would be fixed by contract.2. Cost of goods includes fixed cost of $300,000 per year plus variable costs of S18 per yard. Costs are expected to increase at the inflation rate of 4% per year.3. Depreciation: A SI million investment in machinery is depreciated straight-line over 5 years (S200,000 per year). The S500,000 cost of refurbishing the Pleasantboroplant is depreciated straight-line over 10 years ($50,000 per year).Armed with this information, Mr. Tar constructed a spreadsheet to calculate the NPV of the duffel canvas project, assuming thatSheetbend's bid would be accepted by the navy.He had just finished debugging the spreadsheet when another confidential envelope arrived from Sheetbend's CEO. It contained a firmoffer from a Maine real estate developer to purchase Sheetbend's Pleasantboro land and plant for $1.5 million in cash.Should Mr. Tar recommend submitting the bid to the navy at the proposed price of $30 per yard? The discount rate for this project is 12%. rage JuzMINICASEJack Tar, CFO of Sheetbend & Halyard Inc., opened the internal company confidential envelope. It contained a draft of a competitive bidfor a contract to supply duffel canvas to the U.S. Navy. The cover memo from Sheetbend's CEO asked Mr. Tar to review the bid before itwas submitted.The bid and its supporting documents had been prepared by Sheetbend's sales staff. It called for Sheetbend to supply 100,000 yards ofduffel canvas per year for 5 years. The proposed selling price was fixed at $30 per yard.Mr. Tar was not usually involved in sales, but this bid was unusual in at least two respects. First, if accepted by the navy, it would commitSheetbend to a fixed-price, long-term contract. Second, producing the duffel canvas would require an investment of $1.5 million topurchase machincry and to refurbish Sheetbend's plant in Pleasantboro, Maine.Mr. Tar set to work and, by the end of the week, had collected the following facts and assumptions:• The plant in Pleasantboro had been built in the early 1900s and is now idle. The plant was fully depreciated on Sheetbend's books,except for the purchase cost of the land of $10,000.• Now that the land was valuable shorefront property, Mr. Tar thought the land and the idle plant could be sold, immediately or in thenear future, for $600,000.• Refurbishing the plant would cost $500,000. This investment would be depreciated for tax purposes straight-line over 10 years.• The new machinery would cost $1 million. This investment could be depreciated straight-line over 5 years.• The refurbished plant and new machinery would last for many years. However, the remaining market for duffel canvas was small, and itwas not clear that additional orders could be obtained once the navy contract was finished. The machinery was custom-built and couldbe used only for duffel canvas. Its secondhand value at the end of 5 years was probably zero.L Table 9.2 shows the sales staff's forecasts of income from the navy contract. Mr. Tar reviewed this forecast and decided that itsassumptions were reasonable.• But the forecast income statement contained no mention of working capital. Mr. Tar thought that working capital would average aboutTable 9.2 Forecast income statement for the U.S. Navy duffel canvas project (dollar values in thousands, except price per yard)Year:1231. Yards sold100.00100.00100.00100.00100.002. Price per yard30.0030.0030.0030.0030.003,000.003.000.003.000.003,000.003,000.003. Revenue (1 x 2)4. Cost of goods sold2,100.002,184.002,271.362,362.212,456.70900.00816.00728.64637.79543.305. Operating cash flow (3 - 4)6. Depreciation250.00250.00250.00250.00250.007. Income (5 - 6)650.00566.00478.64387.79293.308. Tax at 30%195.00169.80143.59116.3487.999. Net income (7 - 8)$455.00$396.20$335.05$271.45$205.31

Accepted Answer

The depreciation on machinery and refurbishment extends over a unequal life span. The depreciation…

3. Depreciation: A SI million investment in machinery is depreciated straight-line over 5 years (S200,000 per year). The $500,000 cost of refurbishing the Pleasantboro plant is depreciated straight-line over 10 years ($50.000 per year).