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A firm is considering a new projectThe firm has already paid a $ 1 0 , 0 0 0 consulting fee for the feasibility analysis
A firm is considering a new projectThe firm has already paid a $ consulting fee for the feasibility analysis of the project. The project costs $ to purchase buildings and equipment $ for shipping fee, and $ for installation fee. The life of the project is years. The anticipated sales revenue is $ in the first year and will increase by per year through year The anticipated cost is $ in the first year and will increase by per year through year The working capital needed in this project is of annual sales The project falls in the year ACRS class so it will have depreciation percentages of and The salvage value of the machinery is $ at the end of Year The company is in the tax bracket and has of the cost of capital Please solve it on excel Compute the depreciation basis of the project and the depreciation expenses in years Compute the annual cash flows in years and draw a time line Compute the payback period of the investment Compute the discounted payback of the investment Compute the NPV of the investment Compute the IRR of the investment and discuss the potential problems associated with IRR method in general Compute the MIRR of the investment Should this investment be taken or not? Discuss the reasons
A firm is considering a new projectThe firm has already paid a $ consulting fee for the feasibility analysis of the project. The project costs $ to purchase buildings and equipment $ for shipping fee, and $ for installation fee. The life of the project is years. The anticipated sales revenue is $ in the first year and will increase by per year through year The anticipated cost is $ in the first year and will increase by per year through year The working capital needed in this project is of annual sales The project falls in the year ACRS class so it will have depreciation percentages of and The salvage value of the machinery is $ at the end of Year The company is in the tax bracket and has of the cost of capital Please solve it on excel
Compute the depreciation basis of the project and the depreciation expenses in years
Compute the annual cash flows in years and draw a time line
Compute the payback period of the investment Compute the discounted payback of the investment
Compute the NPV of the investment
Compute the IRR of the investment and discuss the potential problems associated with IRR method in general
Compute the MIRR of the investment
Should this investment be taken or not? Discuss the reasons
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