B E F G H 0 1 2 3 4 12 13 Investment Outlays at Time = 0 14 CAPEX Equipment = Cost (1-T) ANOWC Additional net operating working capital needed Operating Cash Flows Over the Project's 15 16 Life (Time = 1-4) 17 Unit sales -$900 -100 2,720 2,640 2,515 2,430 18 Sales price 19 Variable cost per unit 20 Sales revenues = Units x Price $2.00 $2.00 $2.00 $2.00 $1.0196 $1.0404 $1.0457 $1.1973 $5,440 $5,280 $5,030 $4,860 21 Variable costs = Units × Cost/unit 2,773 2,747 2,630 2,909 22 Fixed operating costs except depr'n 2,000 2,000 2,000 2,000 23 Depreciation: 100% Bonus Depreciation in Year 0 0 0 0 0 24 Total operating costs $4,773 $4,747 $4,630 $4,909 25 EBIT (or Operating income) $667 $533 $400 -$49 26 Taxes on operating income 25% 167 133 100 -12 27 EBIT (1-T) After-tax project operating income $500 $400 $300 -$37 28 Add back depreciation 0 0 0 0 29 EBIT (1-T)+ Depreciation $500 $400 $300 -$37 30 Terminal Cash Flows at Time = 4 31 Salvage value (taxed as ordinary income) 32 Tax on salvage value = 0.25x (SV - BV of equipment at t=4) 33 After-tax salvage value 34 ANOWC = Recovery of net operating working capital Project free cash flows = EBIT(1-T) + DEP 35 36 - CAPEX-ANOWC 50 50 13 37 100 -$1,000 $500 $400 $300 $100 37 Alternative depreciation Straight line 2 3 4 38 Cost: $1,200 Rate 25% 25% 25% 25% 39 40 Project Evaluation @ WACC= Depreciation 10% $300 $300 $300 $300 41 Bonus Depreciation Formulas Straight line 42 NPV $78.82 =NPV(D40,F35:135)+E35 $16.56 43 IRR 14.489% =IRR(E35:135) 10.700% 44 MIRR 12.106% =MIRR(E35:135,D40, D40) 10.349% 45 Payback 2.33 =G12+(-E35-F35-G35)/H35 2.67

please tell me which is the best option and formulate why, thanks

Manshukh

Please use excel formulas when answering questions

Engineered Supplies Inc. has over the past two years been been seriously consideing whether to expand its manufacturing line (the "project"). The company is under pressure to increase its size in order to meet the growth aspirations of its shareholders.The following information is provided: $'000s 1 Estimated start of project Immediate 2 Cost of new line, including installation - payable 50% at beginning of project and balance at end of year 1 750,000 3 Start up of production Start of Year 2 4 Esitimated EBIT of new line per year 200,000 5 Cost of feasibilty study for this new line which was paid during this past year whilst considering investment 500 Tax and accounting depreciation will be straight line over 12 years with no salvage value in the calculation 7 Estimated disposal value for this line from a potential buyer seeking it after 10 years of use. The company feels that it will most likely sell the line after 10 years of use. 90,000 8 Estimated raw material & finished goods…

kar

please answer

Coffer Company is analyzing two potential investments. Cost of machine Project X $ 97,090 Net cash flow: Year 1 Year 2 Year 3 Year 4 Project Y $ 72,000 36,500 3,700 36,500 33,500 36,500 33,500 0 13,000 If the company is using the payback period method, and it requires a payback period of three years or less, which project(s) should be selected? Multiple Choice ○ Project Y. ○ Project X. Both X and Y are acceptable projects. Neither X nor Y is an acceptable project. Project Y because it has a lower Initial Investment.

What is the degree of pretax cash flow operating leverage (cash flow DOL) Revenue $250000 variable costs $162500 fixed costs $40000 EBITDA $47500

Initial Equipment $65,000 Project Life 3 Years Sales $55,000 Variable Costs $25,000 Fixed Costs $ 10,000 Tax rate 26% Cost of Capital 10% Ending Book Value $10,000 Sales Price at Year 3 $5,000 Net Working Capital $10,000 CALCULATE THE INITIAL COSTS, CALCULATE THE OPERATING CASH FLOW, CALCULATE THE TERMINAL NON OPERATING CASH FLOW, CALCULATE THE NPV. please show your work and formulus for the answers