Question
1.) -l A.. By establishing a factory with a beneficial operating life of 8 years and an initial investment amount of 1.400.000,00 TL, all of
1.) -l A.. By establishing a factory with a beneficial operating life of 8 years and an initial investment amount of 1.400.000,00 TL, all of them want to produce sandals from natural leather. The firm's expectations regarding this investment are listed below;
* In the first year of its useful operating life (t1), 10,000 pairs of production will be made, and with the orientation towards authentic products, the amount of production will increase by 7% each year compared to the previous year. * The market price of the sandals will be 300.00 TL and the sales price will increase by 5% each year compared to the previous year. * cost of goods sold will be 70% of net sales. * Operating expenses including depreciation will be 14% of net sales. * The investment will be financed entirely by foreign resources, and during its useful life, 370.000,00 TL will be borne each year. * Corporate tax rate to be subjected to the firm will be 22%. * The rate of profitability that the company expects from this investment is 20%.
According to the above data;
a.) Calculate the payback period of the investment?
b.) Calculate the net present value of the investment?
c.) Calculate the internal rate of return of the investment?
d.) Calculate what should be the initial investment amount in order to reject the investment according to the net present value method.
Thank you ...
Fixed. Pls help..
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