- Complete the capital budgeting methods. FOR ALL BLANK YELLOW please provide excell Formulas Thank you
Salvage value 225,000 The project would provide net operating income each year as follows: Sales S 2,750,000 Variable expenses 1,600,000 Contribution margin 1,150,000 Fixed expenses: Salaries, rent and other fixed out of pocket costs 520,000 Depreciation 350,000 Total fixed expenses 870,000 Net operating income 280 000 Cost of Capital 18% 1. Compute the annual net cash inflow from the project. S 630,000 2. Complete the following timeline to compute the net present value of the future cash flows for this project. Don't forget to include the salvage value in year 5. Year 1 2 3 4 Net cash flow S (1,750,000.00) $ 630,000.00 $ 630,000.00 630,000.00 S 630,000.00 $ 855,000.00 Discount Factor = 1 /((1+r)^n) 1.000 Present value of the cash flows (1,750,000.00) Net present value 3. Use Excel's NPV function to compute the present value of the cash flows from years 1-5. Do not include the original investment at time zero. -NPV of Cash Flows from Years 1-5 $2,068,467.32 Deduct the cost of the investment 1,750,000.00 Net present value $318 467 32 Write an if/then statement to ACCEPT or REJECT the project based on NPV 4. Use Excel's IRR function to compute the project's internal rate of return 25.48%1 2 3 4 Net cash flow S (1,750,000.00) $ 630,000.00 $ 530,000.00 $ 630,000.00 $ 630,000.00 S 855,000.00 Discount Factor = 1 /((1+r)^n) 1.000 Present value of the cash flows S (1,750,000.00) Net present value 3. Use Excel's NPV function to compute the present value of the cash flows from years 1-5. Do not include the original investment at time zero. NPV of Cash Flows from Years 1-5 $2,058,467.32 Deduct the cost of the investment 1,750,000.00 Net present value $318 467 32 Write an if/then statement to ACCEPT or REJECT the project based on NPV 4. Use Excel's IRR function to compute the project's internal rate of return 25.48% Write an if/then statement to ACCEPT or REJECT the project based on IRR 5. Compute the project's payback period. 2.78 years 6. Compute the project's accounting rate of return