Complete this assignment using Microsoft Excel and submit it below. Please submit it as a single file. Assignment Perform financial analysis for a project using the format provided in Figure 4-5 in the text. Assume the costs and benefits for this project are spread over four years as follows: • Estimated costs are $200,000 in Year 1 and $30,000 in Years 2, 3, and 4. • Estimated benefits are $0 in Year 1 and $100,000 each year in Years 2, 3, and 4. • Use a 9% discount rate, and round the discount factors to two decimal places. Create a spreadsheet to calculate and clearly display the NPV, ROI, and year in which payback occurs. Based on the financial analysis, please write a few lines on the spreadsheet explaining whether you would recommend investing in this project. (Tip: Use the spreadsheet format given and limit the table to 4 years. The discount factors should start with 0.92 in year 1.)
Complete this assignment using Microsoft Excel and submit it below. Please submit it as a single file. Assignment Perform financial analysis for a project using the format provided in Figure 4-5 in the text. Assume the costs and benefits for this project are spread over four years as follows: • Estimated costs are $200,000 in Year 1 and $30,000 in Years 2, 3, and 4. • Estimated benefits are $0 in Year 1 and $100,000 each year in Years 2, 3, and 4. • Use a 9% discount rate, and round the discount factors to two decimal places. Create a spreadsheet to calculate and clearly display the NPV, ROI, and year in which payback occurs. Based on the financial analysis, please write a few lines on the spreadsheet explaining whether you would recommend investing in this project. (Tip: Use the spreadsheet format given and limit the table to 4 years. The discount factors should start with 0.92 in year 1.)
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
Related questions
Question
Plz do exactly like they ask in question i attached everything here
Transcribed Image Text:Complete this assignment using Microsoft Excel and submit it below. Please submit it as a single file.
Assignment
Perform financial analysis for a project using the format provided in Figure 4-5 in the text. Assume the costs
and benefits for this project are spread over four years as follows:
• Estimated costs are $200,000 in Year 1 and $30,000 in Years 2, 3, and 4.
• Estimated benefits are $0 in Year 1 and $100,000 each year in Years 2, 3, and 4.
• Use a 9% discount rate, and round the discount factors to two decimal places.
Create a spreadsheet to calculate and clearly display the NPV, ROI, and year in which payback occurs. Based
on the financial analysis, please write a few lines on the spreadsheet explaining whether you would
recommend investing in this project. (Tip: Use the spreadsheet format given and limit the table to 4 years.
The discount factors should start with 0.92 in year 1.)
Transcribed Image Text:Present Value Analysis (3 of 4)
Discount rate
8%
Assume the project is completed in Year 0
0
Costs
Discount factor
Discounted costs
Benefits
Discount factor
Discounted benefits
Discounted benefits - costs
Cumulative benefits - costs
ROI
1
140,000 40,000
1
0.93
140,000 37,200
Year
2
3 Total
40,000
40,000
0.86
0.79
34,400 31,600 243,200
0 200,000 200,000 200,000
1
0.93
0.86
0.79
0 186,000 172,000 158,000 516,000
(140,000) 148,800 137,600 126,400 272,800+NPV
(140,000) 8,800 146,400 272,800
112%
Payback in Year 1
FIGURE 4-5 JWD Consulting net present value and return on investment example
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 2 images
Recommended textbooks for you
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
Finance
ISBN:
9781337395250
Author:
Eugene F. Brigham, Joel F. Houston
Publisher:
Cengage Learning
Corporate Finance (The Mcgraw-hill/Irwin Series i…
Finance
ISBN:
9780077861759
Author:
Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor
Publisher:
McGraw-Hill Education