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8. The following information is given for determining profitability of a project. ( K implies 1,000) Equipment Cost =$200K Lang Factor (including Land and Working
8. The following information is given for determining profitability of a project. ( K implies 1,000) Equipment Cost =$200K Lang Factor (including Land and Working Capital) =5.0 Land Cost =$200K Working Capital =$200K Salvage Value =$100K Construction Period =1 year Plant Life =10 years Depreciation Method = Straight line with 7-year depreciation life Revenue =$700K/ year Cash Expenses =$300K/ year Tax Rate =25% Minimum Attractive Rate of Return (im)=20% a. What are the annual Cash flows (CFs)? (CF1= ?, CF0= ? ,CF17=?,CF89= ?, CF10= ? ) b. What is the payback-time (PBT) and Return on Investment (ROI)? c. What is Net Present Worth (NPW) of the project? d. Sketch the cumulative non-discounted cash flow diagram labeling all key elements. 8. The following information is given for determining profitability of a project. ( K implies 1,000) Equipment Cost =$200K Lang Factor (including Land and Working Capital) =5.0 Land Cost =$200K Working Capital =$200K Salvage Value =$100K Construction Period =1 year Plant Life =10 years Depreciation Method = Straight line with 7-year depreciation life Revenue =$700K/ year Cash Expenses =$300K/ year Tax Rate =25% Minimum Attractive Rate of Return (im)=20% a. What are the annual Cash flows (CFs)? (CF1= ?, CF0= ? ,CF17=?,CF89= ?, CF10= ? ) b. What is the payback-time (PBT) and Return on Investment (ROI)? c. What is Net Present Worth (NPW) of the project? d. Sketch the cumulative non-discounted cash flow diagram labeling all key elements
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