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A company is considering to buy a major project worth $22 million. It is a five-year project. The sales and cost data are provided here:
A company is considering to buy a major project worth $22 million. It is a five-year project. The sales and cost data are provided here: Year 1 Sales (Units) 1 80,000 2 90,000 3 100,000 4 110,000 5 90,000 Price per unit = $400 Variable cost per unit = $200 Fixed costs per year = $800,000 Depreciation/CCA per year = $40,000 Tax rate = 30% Discount rate = 10% REQUIRED: Use the following template, calculate the IRR, PI, Payback period and AAR showing the calculations and also the financial calculator method
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