510-515 3. The total capital investment for a hydrometallurgical plant of zinc production is Rs. 10 Cr and the plant produces 4,000 tons of products annually. The selling price of zinc product is Rs. 0.33 Lakhs/ton. The working capital amounts to 16% of total capital investment (TCI). For the investment, which is made by company funds, no interest is charged. Raw material (zinc concentrate) costs for the zinc product are Rs. 0.036 Lakhs/ton, labor Rs. 0.032 Lakhs/ton, utilities Rs. 0.02 Lakhs/ton and packaging Rs. 0.0032 Lakhs/ton. Distribution costs are 4% of the total production costs (TPC). Estimate the following: A. Manufacture cost per ton of product. B. Total production cost per year C. Profit per ton of product after taxes. D. % ROI E. Payout time
510-515 3. The total capital investment for a hydrometallurgical plant of zinc production is Rs. 10 Cr and the plant produces 4,000 tons of products annually. The selling price of zinc product is Rs. 0.33 Lakhs/ton. The working capital amounts to 16% of total capital investment (TCI). For the investment, which is made by company funds, no interest is charged. Raw material (zinc concentrate) costs for the zinc product are Rs. 0.036 Lakhs/ton, labor Rs. 0.032 Lakhs/ton, utilities Rs. 0.02 Lakhs/ton and packaging Rs. 0.0032 Lakhs/ton. Distribution costs are 4% of the total production costs (TPC). Estimate the following: A. Manufacture cost per ton of product. B. Total production cost per year C. Profit per ton of product after taxes. D. % ROI E. Payout time
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:510-515
3. The total capital investment for a hydrometallurgical plant of zinc production is Rs. 10 Cr
and the plant produces 4,000 tons of products annually. The selling price of zinc product is
Rs. 0.33 Lakhs/ton. The working capital amounts to 16 % of total capital investment (TCI).
For the investment, which is made by company funds, no interest is charged. Raw material
(zinc concentrate) costs for the zinc product are Rs. 0.036 Lakhs/ton, labor Rs. 0.032
Lakhs/ton, utilities Rs. 0.02 Lakhs/ton and packaging Rs. 0.0032 Lakhs/ton. Distribution
costs are 4% of the total production costs (TPC). Estimate the following:
A. Manufacture cost per ton of product.
B. Total production cost per year
C. Profit per ton of product after taxes.
D. % ROI
E. Payout time
516-524
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Step 1: Distribution costs are assumed to be 4% of the total production costs
VIEWStep 2: ROI, calculated at 66.864%, indicates that for every rupee invested, the return is 66.846
VIEWStep 3: Payout time, represents the duration required for the investment to recoup its initial cost, and wc
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