Exhibit 2 Cost of Capital Calculation: APSI Cost of Equity (Show detailed calculations for the cost of equity-all steps should be shown and clearly labelled.) Cost of Debt (Show detailed calculations for the cost of debt - all steps should be shown and clearly labelled.) Weighted Average Cost of Capital (Show detailed calculations for the WACC - all steps should be shown and clearly labelled.) I Enable Editing Monthly Stock Index 1 2 3 4 5 Dura Surface Share Price 60.21 61.31 62.66 63.38 63.21 6 61.88 7 1 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 6003.56 6037.33 6154.88 6234.33 6450.67 6340.77 6120.88 5807.33 5783.78 5845.44 5965.44 5927.03 5803.34 6034.33 6100.93 6378.45 6456.33 6409.37 6543.55 6698.33 6703.87 6684.34 6834.95 6699.44 6584.50 6593.22 6534.56 6667.98 6490.88 58.27 54.54 53.54 55.65 57.66 55.33 54.87 57.38 60.38 63.37 65.08 64.30 67.39 70.74 74.32 69.30 72.77 72.64 64.58 65.38 63.76 66.31 65.43 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 6389.22 6289.78 6305.53 6310.76 6450.33 6477.88 6485.94 6432.94 6600.00 6734.55 7321.34 7454.34 7645.48 7903.33 8134.33 8234.33 8305.33 8300.87 8413.75 8500.33 8700.34 8654.00 8778.30 8503.00 8876.33 8903.33 9034.44 8953.33 8957.32 9003.78 8933.68 62.87 60.38 61.83 62.95 64.30 64.57 66.83 63.83 65.44 68.33 73.58 74.83 80.30 72.37 77.30 80.58 83.58 83.32 84.69 85.32 89.69 87.32 90.64 87.32 93.65 92.43 93.43 92.55 95.53 94.33 93.58 H! E W Automated Paving Stone Installer (APSI) Projections A new factory is needed to manufacture the APSI. The facility can produce up to 250 machines each year over the product's 15-year life. A parcel of land worth CAD 450,000 will be purchased, and a building constructed for CAD 1,750,000. Equipment costing CAD 3,550,000 is also be required. At the end of the project's life, it is estimated the land can be sold for CAD 770,000, while the building will have a residual value of CAD 850,000 and the equipment's residual value will be negligible. Building and equipment costs are subject to CCA rates of 4.0% and 20.0% respectfully. An investment of CAD 350,000 in net working capital is needed to support production that will be liquidated at the end of the product's life. APSI sales are forecasted to be 100 units in the first year, 200 in the second year, and then reach factory capacity of 250 units in the third year. The product's list price is CAD 350,000 and its unit cost is CAD 338,500, which includes direct materials, direct labour and factory overhead. Incremental selling and administration costs will be CAD 1,570,000. Existing corporate overhead of CAD 230,000 per year will be allocated to the product as per company policy. Factory equipment will be overhauled at a cost of CAD 1,500,000 at the end of year 8. Beta Company Rapid Flow Environmental Systems Clean Air Treasury Spread 4.12% 1.43 1.25 3.91% 1.37 4.03% CircuVent 1.42 4.08% Pure Air 1.29 4.02% Exhibit 2 Cost of Capital Calculation: APSI Cost of Equity (Show detailed calculations for the cost of equity-all steps should be shown and clearly labelled.) Cost of Debt (Show detailed calculations for the cost of debt - all steps should be shown and clearly labelled.) Weighted Average Cost of Capital (Show detailed calculations for the WACC - all steps should be shown and clearly labelled.) I Enable Editing Monthly Stock Index 1 2 3 4 5 Dura Surface Share Price 60.21 61.31 62.66 63.38 63.21 6 61.88 7 1 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 6003.56 6037.33 6154.88 6234.33 6450.67 6340.77 6120.88 5807.33 5783.78 5845.44 5965.44 5927.03 5803.34 6034.33 6100.93 6378.45 6456.33 6409.37 6543.55 6698.33 6703.87 6684.34 6834.95 6699.44 6584.50 6593.22 6534.56 6667.98 6490.88 58.27 54.54 53.54 55.65 57.66 55.33 54.87 57.38 60.38 63.37 65.08 64.30 67.39 70.74 74.32 69.30 72.77 72.64 64.58 65.38 63.76 66.31 65.43 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 6389.22 6289.78 6305.53 6310.76 6450.33 6477.88 6485.94 6432.94 6600.00 6734.55 7321.34 7454.34 7645.48 7903.33 8134.33 8234.33 8305.33 8300.87 8413.75 8500.33 8700.34 8654.00 8778.30 8503.00 8876.33 8903.33 9034.44 8953.33 8957.32 9003.78 8933.68 62.87 60.38 61.83 62.95 64.30 64.57 66.83 63.83 65.44 68.33 73.58 74.83 80.30 72.37 77.30 80.58 83.58 83.32 84.69 85.32 89.69 87.32 90.64 87.32 93.65 92.43 93.43 92.55 95.53 94.33 93.58 H! E W Automated Paving Stone Installer (APSI) Projections A new factory is needed to manufacture the APSI. The facility can produce up to 250 machines each year over the product's 15-year life. A parcel of land worth CAD 450,000 will be purchased, and a building constructed for CAD 1,750,000. Equipment costing CAD 3,550,000 is also be required. At the end of the project's life, it is estimated the land can be sold for CAD 770,000, while the building will have a residual value of CAD 850,000 and the equipment's residual value will be negligible. Building and equipment costs are subject to CCA rates of 4.0% and 20.0% respectfully. An investment of CAD 350,000 in net working capital is needed to support production that will be liquidated at the end of the product's life. APSI sales are forecasted to be 100 units in the first year, 200 in the second year, and then reach factory capacity of 250 units in the third year. The product's list price is CAD 350,000 and its unit cost is CAD 338,500, which includes direct materials, direct labour and factory overhead. Incremental selling and administration costs will be CAD 1,570,000. Existing corporate overhead of CAD 230,000 per year will be allocated to the product as per company policy. Factory equipment will be overhauled at a cost of CAD 1,500,000 at the end of year 8. Beta Company Rapid Flow Environmental Systems Clean Air Treasury Spread 4.12% 1.43 1.25 3.91% 1.37 4.03% CircuVent 1.42 4.08% Pure Air 1.29 4.02%