Question
A firm has projected the following financials for a possible project: YEAR 0 1 2 3 4 5 Sales 135,002.00 135,002.00 135,002.00 135,002.00 135,002.00 Cost
A firm has projected the following financials for a possible project:
| YEAR | 0 | 1 | 2 | 3 | 4 | 5 |
|---|---|---|---|---|---|---|
| Sales | 135,002.00 | 135,002.00 | 135,002.00 | 135,002.00 | 135,002.00 | |
| Cost of Goods | 63,283.00 | 63,283.00 | 63,283.00 | 63,283.00 | 63,283.00 | |
| S&A | 30,000.00 | 30,000.00 | 30,000.00 | 30,000.00 | 30,000.00 | |
| Depreciation | 20,337.40 | 20,337.40 | 20,337.40 | 20,337.40 | 20,337.40 | |
| Investment in NWC | 1,178.00 | 597.00 | 597.00 | 597.00 | 597.00 | 597.00 |
| Investment in Gross PPE | 101,687.00 |
The firm has a capital structure of 49.00% debt and 51.00% equity. The cost of debt is 10.00%, while the cost of equity is estimated at 15.00%. The tax rate facing the firm is 35.00%. (Assume that you can't recover the final NWC position in year 5. i.e. only consider the change in NWC for each year)
What is the cash flow for year 1?
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Dropshipping
Authors: Income Mastery
1st Edition
1698964293, 978-1698964294
