1 Suppose that Calloway golf would like to capitalize on Phil Michelson winning the Open Championship in 2013 by releasing a new putter The new product will require new equipment for $412,576 00 that will be depreciated using the 5 year MACRS schedule The project will run for 2 years with the following forecasted numbers Year 1 Year 2 Putter price $61 68 $61 68 Units sold 19,065 00 11,521 00 COGS 39 00 of sales 39 00 of sales Selling and Administrative 20 00 of sales 20 00 of sales Calloway has a 12 00 cost of capital and a 40 00 tax rate The firm expects to sell the equipment after 2 years for a NSV of $138,796 00 What is the project cash flow for year 2 (include the terminal cash flow here) 2 Suppose that Calloway golf would like to capitalize on Phil Michelson winning the Open Championship in 2013 by releasing a new putter The new product will require new equipment for $407,525 00 that will be depreciated using the 5 year MACRS schedule The project will run for 2 years with the following forecasted numbers Year 1 Year 2 Putter price $61 32 $61 32 Units sold 19,393 00 11,191 00 COGS 38 00 of sales 38 00 of sales Selling and Administrative 19 00 of sales 19 00 of sales Calloway has a 14 00 cost of capital and a 39 00 tax rate The firm expects to sell the equipment after 2 years for a NSV of $154,416 00 What is the NPV of the project

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1. Suppose that Calloway golf would like to capitalize on Phil Michelson winning the Open Championship in 2013 by releasing a new putter. The new

Suppose that Calloway golf would like to capitalize on Phil Michelson winning the Open Championship in 2013 by releasing a new putter. The new product will require new equipment for $412,576.00 that will be depreciated using the 5-year MACRS schedule. The project will run for 2 years with the following forecasted numbers:

	Year 1	Year 2
Putter price	$61.68	$61.68
Units sold	19,065.00	11,521.00
COGS	39.00% of sales	39.00% of sales
Selling and Administrative	20.00% of sales	20.00% of sales

Calloway has a 12.00% cost of capital and a 40.00% tax rate. The firm expects to sell the equipment after 2 years for a NSV of $138,796.00.

What is the project cash flow for year 2? (include the terminal cash flow here)

Suppose that Calloway golf would like to capitalize on Phil Michelson winning the Open Championship in 2013 by releasing a new putter. The new product will require new equipment for $407,525.00 that will be depreciated using the 5-year MACRS schedule. The project will run for 2 years with the following forecasted numbers: