can you show me how to so this using excel as well see how each cell was answerd thanks you. the other guy just showed me the answers not how it was worked out. ill give a thumbs up of course
- N B D E F G 1 2 3 4 5 6 7 8 9 10 P12-14 Modified (use the template below for problem setup) As part of its planning for the coming Christmas season, Criswell Motorsports is considering whether to expand its product line that currently consists of skateboards to include gas-powered skateboards. The company feels it can sell 2,500 of these per year for 10 years (after which time this project is expected to shut down, with solar-powered skateboards taking over). Each gas-powered skateboard would have variable costs of $100 and sell for $225; annual fixed costs associated with production would be $235,000. In addition, there would be a $525,000 initial expenditure associated with the purchase of new production equipment. It is assumed that the simplified straight-line method would be used to depreciate this initial expenditure down to zero over 10 years. The project would also require a one-time Initial investment of $75,000 in net working capital associated with inventory, and this working-capital investment would be recovered when the project is shut down. Finally, assume that the firms's marginal tax rate is 26%. a. What is the initial cash outlay associated with this project? b. What are the annual net cash flows associated with this project for years 1-9? c. What is the terminal cash flow in year 10 (that is what is the free cash flow in year 10 plus any additional cash flows associated with the termination of the project?) d. What is the projects NPV given a 12% required rate of return? 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 INPUTS (in Blue): Tax Rate Required Rate of Return Years Cost of the New Equipment Initial Working Capital Annual Units Sold Sale Price per unit Variable cost per unit Annual fixed costs ONS 26 27 4 6 9 10 26 Variable content 27 Anul cu 28 28 Year 0 10 Un So 31 Sale Price 12 Variable cost/UT Anal Feed Cost 10 Deprecation Rate 35 16 Step 1: Calice Met Operating how 32 Sales Vanable coste 19 40 Deprecat 41 Operatincome 42 Tues 21 Operating come her 44 Ph: Deprecation 05 Oresting Cash 46 43 Step Working Capital Woments Wit Got Memes 09 50 Stephaluate Capital Expenditure (CAPEX) Requirements 51 Ganita pendur CAPE Rendement 52 53 50 55 Stepe Calculate Free how Free Flow 61 P12-14 PM Meady