10) (30pts) A U.S. company owns land in Vietnam, and a building on that land. The company is deciding whether to tear down the building to construct a factory. In 30 years the factory would be sold for its salvage value. Assume the company does not pay taxes. Which of the following items is needed to build a cash flow model? Explain why. CF? Why or why not? ASSUME NO TAXES a) The book value of the building b) Money to be paid this year to the architect who designed the factory last year c) A proportion of the cost of leasing the president's airplane d) The salvage value of the Factory e) Depreciation of the factory in each of the next 30 years f) Interest expense to finance the project Now assume the company pays taxes. Which items below are needed to make a decision? COMPANY PAYS TAXES Need? Why or why not? g) The book value of the building h) Money to be paid this year to the architect who designed the factory last year i) A proportion of the cost of leasing the president's airplane j) The salvage value of the Factory k) Depreciation of the factory in each of the next 30 years 1) Interest expense to finance the project 10) (30pts) A U.S. company owns land in Vietnam, and a building on that land. The company is deciding whether to tear down the building to construct a factory. In 30 years the factory would be sold for its salvage value. Assume the company does not pay taxes. Which of the following items is needed to build a cash flow model? Explain why. CF? Why or why not? ASSUME NO TAXES a) The book value of the building b) Money to be paid this year to the architect who designed the factory last year c) A proportion of the cost of leasing the president's airplane d) The salvage value of the Factory e) Depreciation of the factory in each of the next 30 years f) Interest expense to finance the project Now assume the company pays taxes. Which items below are needed to make a decision? COMPANY PAYS TAXES Need? Why or why not? g) The book value of the building h) Money to be paid this year to the architect who designed the factory last year i) A proportion of the cost of leasing the president's airplane j) The salvage value of the Factory k) Depreciation of the factory in each of the next 30 years 1) Interest expense to finance the project