Please help me with this land project assignment The projected costs for a new plant are given below (all numbers are in Millions):Land Cost = $10Fixed Capital Investment without land = $100 ($40 at end of year 1, $40 at end of year 2, and $20at end of year 3)Working Capital = $20 (at start-up)Start-up at end of year 3Revenue from sales are $80 for the entire project lifetime of 10 years.Cost of manufacturing (without depreciation) = $25Tax rate = 40%Depreciation method = Current MACRS over 5 yearsInternal rate of return = 10% p.a. (Interest rate)(1). For this project, please do the following:a. Draw a cumulative (non-discounted) after-tax cash flow diagram.b. From Part (a), calculate the following non-discounted profitability criteria for the project:(i) Cumulative cash position and cumulative cash ratio(ii) Payback period(iii) Rate of return on investmentc. Draw a cumulative (discounted) after-tax cash flow diagram.d. From Part (c), calculate the following discounted profitability criteria for the project:(i) Net present value and net present value ratio(ii) Discounted payback period(iii) Discounted cash flow rate of return (DCFROR)

CalculationsYearFixed Capital InvestmentWorking CapitalRevenueManufacturing CostDepreciationTaxable…

Answered: The projected costs for a new plant are…

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter2: Introduction To Spreadsheet Modeling

Section: Chapter Questions

Problem 21P

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Use the generated information to calculate the NPV ofnthe project, to decide whether to go ahead with the project. Investment required. R200 000. Expected economic lifetime. 5 years Minimum requred rate of return. 10% Net annual cash inflows 1st year. R40 000 2nd year. R100 000 3rd year. R90 000 4th year. R40 000 5th year. R30 000
Randall Systems in considering four projects A, B, C and D that have risks associated with the producing benefits. Based on the information given in the table below, which project is more desirable for the company? Project A Project B Project C Project D EUAW Prob. EUAW Prob. EUAW Prob. EUAW Prob. $2,000 0.2 $3,000 0.1 -$5,000 0.2 $4,000 0.4 $1,500 0.5 -$2,500 0.4 $6,500 0.5 $2,500 0.3 $3,000 0.3 $3,500 0.5 $1,000 0.3 -$2,000 0.3
1.You’re managing a project to install 400 windows in a new skyscraper and need to figure outyour budget. Each week of the project costs the same: your team members are paid a total of $4,000every week, and you need $2,000 worth of parts each week to do the work. If the project isscheduled to last 16 weeks, calculate theBAC, PV, EV, AC, SPI, SV, CPI, SPI, CV for the project? 2.You’re managing a highway construction project. Your total budget is $650,000, and there isa total of 7,500 hours of work scheduled on the project. You check with your accountingdepartment, and they tell you that you’ve spent a total of $400,000. According to the schedule,your crew should have worked 4,500 hours, but your foreman says that the crew was allowed towork some overtime, and they’ve put in 5,100 hours of work. Calculate theBAC, PV, EV, AC, SPI, SV, CPI, SPI, CV for the project?
CVP Analysis Lawn Master Company, a manufacturer of riding lawn mowers, has a projectedincome for the coming year as follows:Sales $46,000,000Operating expenses:Variable expenses $32,200,000Fixed expenses 7,500,000Total expenses 39,700,000Operating profit $ 6,300,000Required1. Determine the breakeven point in sales dollars.2. Determine the required sales in dollars to earn a before-tax profit of $8,000,000.3. What is the breakeven point in sales dollars if the variable expenses increases by 12%?
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A rock concert producer has scheduled an outdoor concert. The producer estimates the attendance will depend on the weather according to the following table. Weather Attendance Probability wet, cold 4000 0.1 wet, warm 25000 0.1 dry, cold 30000 0.1 dry, warm 45000 0.7 (a) What is the expected attendance? (b) If tickets cost $ 30 each, the band will cost $ 250,000, plus $ 55,000 for administration. What is the expected profit?
Quorex is evaluating two mutually exclusive projects. Project A has a net investment of $50,000 and net cash flows over a six-year period of $13,000 per year (NOTE: that project requires a reinvestment with the same cost and cash flow for another six years). Project B has a net investment of $48,500, but its net cash flows of $8,740 per year will occur over a 12-year period. If Quorex has a cost of capital of 14% for these projects, which project, if either, should be chosen, and what is its NPV?
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Fin 30 atem Assignment due on Friday 2005 IBM is considering a new expansion project and the finance staff has received information summarized below. The project require IBM to purchase $900,000 of equipment in 2013 (t=0). Inventory will increase by $175,000 and accounts payable will rise by $75,000. The project will last for four years. The company forecasts that they will sell 2.000,000 units in 2014, 2,500,000 units in 2015, 2,500,000 units in 2016, and 2.400,000 units in 2017. Each unit will sell for $2 in 2014, $3 in 2015, $2.5 in 2016 and $2 in 2017. The fixed cost of producing the product is $2 million each year. The variable cost of producing each unit will rise from $1.05, $1.03, $1.4 and $1.05 from 2014 to 2017 respectively. The equipment will be depreciated under the MACRS system using the applicable rates of 33%, 45%, 15%, and 7% respectively When the project is completed in 2017 (t=4), the company expects that it will be able to salvage the equipment for $100,000, and it…
depends on interest rate movement in the next 5 years. The various development projects and 8. Place-Plus, a real estate development firm, is considering several alternative development a projects. These include building and leasing building an office park, purchasing a parcel of land and an office building to rent, buying anmd leasing a warchouse, building a strip shopping ter, and building and selling condominiums. The financial success of these projects meir 5 year financial return (MU millions) given that interest rates will decline, remain stable or increase are shown in the following payoff table: Interest Rates Projects Office Park OfficeBuilding We Shopping Center Condominiums Decline Stable Increase 0.5 1.7 4.5 1.5 1.9 2.4 1.7 1.4 0.7 2.4 3.6 3.2 1.5 0.6 Determine the best investment using the following decision criteria: a. Maximax b. Maximin c. Minimax regret d. Equally Likely e. Hurwicz (a 0.3)
Kiley Electronics is considering a project that has the following cash flow data. What is the project's IRR, and should the firm accept the project based on IRR if its WACC is 13.00%? Year 0 1 2 3 Cash flows -$1,100 $450 $470 $490 13.31%; Accept 13.31%; Reject -14.64%; Reject 11.98%; Accept 11.98%; Reject

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