Goats: The Green Alternative (B)

Answer the following questions. Organize financial analysis in supporting appendices. Summarize your descriptive and concluding comments in the main body of the report.

1. Compute the number of calendar days needed to complete a one-acre job using the current truck/trailer combination and the larger truck/trailer combination. Use the result to calculate the maximum number of jobs McCoy could accept per year using each truck/trailer combination.

2. Using the results from Question 1, compute the incremental annual revenues (cash flows) if McCoy invests in the larger truck and trailer. Use the model in case Exhibit 1 to compute incremental annual expenses (cash outflows) if McCoy invests in the larger truck and trailer. Determine incremental cash flows for the larger truck and trailer.

3. Using the results from Question 2, prepare a spreadsheet modeling the initial investment and the incremental annual cash inflows and outflows for each of the next five years.