Prepare the financial section of a business case for the Cloud-Computing Case that is listed above this assignment in Canvas. Assume that this project will take eight months to complete (in Year 0) and will cost $600,000. The costs to implement some of the technologies will be $300,000 for year one and $200,000 for years two and three. Estimated benefits will start in year 1 at$400,000 and will be $600,000 for years 2 and 3. There is no benefit in year 0. Use the business case spreadsheet template (business_case_financials.xls) template provided below this assignment in Canvas to calculate the NPV, ROI, and the year in which payback occurs. Assume a 7 percent discount rate for the template. notes* Payback occurs in the first year that there is a positive value for cumulative benefits - costs. (*Negative values are presented in parenthesis) Financial Analysis for Project Name Created by:   Date:         Note: Change the inputs, shown in green below (i.e. interest rate, number of years, costs, and benefits). Be sure to double-check the formulas based on the inputs.

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
icon
Related questions
Question
100%

Prepare the financial section of a business case for the Cloud-Computing Case that is listed above this assignment in Canvas. Assume that this project will take eight months to complete (in Year 0) and will cost $600,000. The costs to implement some of the technologies will be $300,000 for year one and $200,000 for years two and three. Estimated benefits will start in year 1 at$400,000 and will be $600,000 for years 2 and 3. There is no benefit in year 0. Use the business case spreadsheet template (business_case_financials.xls) template provided below this assignment in Canvas to calculate the NPV, ROI, and the year in which payback occurs. Assume a 7 percent discount rate for the template. notes* Payback occurs in the first year that there is a positive value for cumulative benefits - costs. (*Negative values are presented in parenthesis)

Financial Analysis for Project Name
Created by:   Date:        
Note: Change the inputs, shown in green below (i.e. interest rate, number of years, costs, and benefits). Be sure to double-check the formulas based on the inputs.
             
Discount rate 8.00%          
             
Assume the project is completed in Year 0     Year      
  0 1 2 3 Total  
Costs 140,000 40,000 40,000 40,000    
Discount factor 1.00 0.93 0.86 0.79    
Discounted costs       140,000    37,200    34,400    31,600   243,200  
             
Benefits 0 200,000 200,000 200,000    
Discount factor 1.00 0.93 0.86 0.79    
Discounted benefits 0  186,000  172,000  158,000   516,000  
             
Discounted benefits - costs      (140,000)  148,800  137,600  126,400
  272,800
NPV
Cumulative benefits - costs      (140,000)
     8,800
 146,400  272,800    
             
ROI
112%          
  Payback in Year 1      
Assumptions            
Enter assumptions here            
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 3 steps with 2 images

Blurred answer
Knowledge Booster
Capital Budgeting
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, finance and related others by exploring similar questions and additional content below.
Similar questions
  • SEE MORE QUESTIONS
Recommended textbooks for you
Essentials Of Investments
Essentials Of Investments
Finance
ISBN:
9781260013924
Author:
Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:
Mcgraw-hill Education,
FUNDAMENTALS OF CORPORATE FINANCE
FUNDAMENTALS OF CORPORATE FINANCE
Finance
ISBN:
9781260013962
Author:
BREALEY
Publisher:
RENT MCG
Financial Management: Theory & Practice
Financial Management: Theory & Practice
Finance
ISBN:
9781337909730
Author:
Brigham
Publisher:
Cengage
Foundations Of Finance
Foundations Of Finance
Finance
ISBN:
9780134897264
Author:
KEOWN, Arthur J., Martin, John D., PETTY, J. William
Publisher:
Pearson,
Fundamentals of Financial Management (MindTap Cou…
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…
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

Expert Answers to Latest Homework Questions

Q: Compute a Monte Carlo estimate of 0.8 by sampling from Uniform(0,0.8) and estimate the variance of…
Q: please draw in the answeres, thank you
Q: 4. Given the following information determine the appropriate trial solution to find yp. Do not solve…
Q: Why you would be a quality recipient of the Linda K Crandall Nutrition Scholarship.
Q: For the reaction below: 1. Draw all reasonable elimination products to the right of the arrow. 2. In…
Q: 9.7 Given the equations 0.5x₁-x2=-9.5 1.02x₁ - 2x2 = -18.8 (a) Solve graphically. (b) Compute the…
Q: Major League Baseball's World Series is a maximum of seven games, with the winner being the first…
Q: 3. Determine the appropriate annihilator for the given F(x). a) F(x) = 5 cos 2x b) F(x)=9x2e3x
Q: OK i need help. Please help me work thorought this with autocad. I am not sure where to begin but i…
Q: Model File Available: Download NBAGIMS.xlsx The Iowa Wolves are scheduled to play against the Maine…
Q: 12.42 The steady-state distribution of temperature on a heated plate can be modeled by the Laplace…
Q: Normal probability distribution Assuming that the rates of return associated with a given asset…
Q: How do the major systems of social stratification—slavery, caste, and class—differ in terms of…
Q: The wedding date for a couple is quickly approaching, and the wedding planner must provide the…
Q: Both images attached go together  label the nerves on all three of the following images, where…
Q: 9.22 Develop, debug, and test a program in either a high-level language or a macro language of your…
Q: A square column foundation has to carry a gross allowable load of 2005 kN (FS = 3). Given: D₤ = 1.7…
Q: For the design of a shallow foundation, given the following: Soil: ' = 20° c=57 kN/m² Unit weight,…
Q: please do it correctly Label and outline each structure please please please label on both the…
Q: please just label the model/structure no need to explain in detail just use arrows showing where…
Q: 1.0 m (Eccentricity in one direction only) = 0.15 m Qall = 0 1.5 m x 1.5 m Centerline An…