A: Given the available information, what are the free cash flows in years 0-10 that should be used to evaluate the proposed project?
B: If the cost of capital for this project is listed below, what is your estimate of the NPV of the new project?
For Question B: Tax rate=25% and Cost of Capital =18%
itarmante if coliti) 1. By using cell references, calculate the gross profit for Year 1-10 (10 pt.) 2 Calculate the net operating income for Year 1-10 (10 pt.). 3 Calculate the income tax for Year 1-10 (10 pt.). 4 Calculate the net income for Year 1-10 (10 pt.). 5 Calculate the sum of the cost of the machine and the change in the net working capital (happens in Year 0 and 10) (10pt.) 6 Calculate the cash flow in Year 010(20pt). 7 Use the information on Cost of Capital, calculate the NPV of this project (10 pt.). 8 Save the workbook. Fill the Google form for your answers. (20 pt.) Yoe are a manaze at Percotated Fwetr, which is considening expunding its operations in syzthetic fiber maniufacturing. Your boss comes into your office, drops s connetiet i report on your dewh, and complains, "We owe these constilants $1 million for this report, and I am not sure their analysis makes sense. Before we thoucund of datitink) Informution Sheet Answershert 3. Given the available infomation, what are the free cash flows in years 0 through 10 that should be used to evaluate the proposed project? b. If the cost of capital for this project is listed below, What is your estimate of the NPV of the new project? Tax rate Cost of Capital Instructions and Grading Rubric: 1 By using cell references, calculate the gross profit for Year 1-10 (10 pt.). 2 Calculate the net operating income for Year 110(10pt ). 3 Calculate the income tax for Year 110 (10 pt.) 4 Calculate the net income for Year 1-10 (10 pt.). 5 Calculate the sum of the cost of the machine and the change in the net working capital (happens in Year 0 and 10 ) ( 10 pt.) 6 Calculate the cash flow in Year 0 - 10(20pt.). 7 Use the information on Cost of Capital, calculate the NPV of this project (10 pt.). 8 save the workbook. Fill the Google form for your answers. (20 pt.) itarmante if coliti) 1. By using cell references, calculate the gross profit for Year 1-10 (10 pt.) 2 Calculate the net operating income for Year 1-10 (10 pt.). 3 Calculate the income tax for Year 1-10 (10 pt.). 4 Calculate the net income for Year 1-10 (10 pt.). 5 Calculate the sum of the cost of the machine and the change in the net working capital (happens in Year 0 and 10) (10pt.) 6 Calculate the cash flow in Year 010(20pt). 7 Use the information on Cost of Capital, calculate the NPV of this project (10 pt.). 8 Save the workbook. Fill the Google form for your answers. (20 pt.) Yoe are a manaze at Percotated Fwetr, which is considening expunding its operations in syzthetic fiber maniufacturing. Your boss comes into your office, drops s connetiet i report on your dewh, and complains, "We owe these constilants $1 million for this report, and I am not sure their analysis makes sense. Before we thoucund of datitink) Informution Sheet Answershert 3. Given the available infomation, what are the free cash flows in years 0 through 10 that should be used to evaluate the proposed project? b. If the cost of capital for this project is listed below, What is your estimate of the NPV of the new project? Tax rate Cost of Capital Instructions and Grading Rubric: 1 By using cell references, calculate the gross profit for Year 1-10 (10 pt.). 2 Calculate the net operating income for Year 110(10pt ). 3 Calculate the income tax for Year 110 (10 pt.) 4 Calculate the net income for Year 1-10 (10 pt.). 5 Calculate the sum of the cost of the machine and the change in the net working capital (happens in Year 0 and 10 ) ( 10 pt.) 6 Calculate the cash flow in Year 0 - 10(20pt.). 7 Use the information on Cost of Capital, calculate the NPV of this project (10 pt.). 8 save the workbook. Fill the Google form for your answers. (20 pt.)
