had to find irr and npv for company and if they should invest in new smartphone. please come up with a 100 respone to findings below

JL LULU ULJUJ PI After calculating the IRR and the NPV for the project sales of Conch Electronics new prototype smartphone, I believe that they should invest in the project to create the new phone. This is due to the fact that they the IRR for these sales would be 48% with a NPV totaling to $50,306,045.12. In order for Conch Electronics to declare this project a success, they stated that they would need an IRR of at least 12%. Seeing that the IRR would be 48%, it is clear that they should invest in this product. The first thing that did was determine the total cash flow for sales that would include the prototype phone. In order to do this I had to create an income statement for the first five sales years and the Net Working Capital for those years as well. Once I had that, I was able to calculate the total cash flows for those years. Using this information, I was then able to calculate the IRR. The IRR can be calculated by setting the NPV equation to 0 and then using trial and error to solve for the IRR. This can be a long and tedious process. However, excel has an =IRRO function that allows the user to enter their values and then their guess as to what the IRR will be. This then calculates the IRR. I entered all of my total cash flows for years 0-5 and initially guess an IRR of 39%. The function then calculated the IRR to be 48%. The next thing I did was solve for the NPV. This is done by simply plugging in the initial investment, cash flows, and the rate into the NPV formula. Excel also has a =NPVO) function that allows you to enter the rate, in this case the given rate for the project to succeed was 1296, the initial investment, and the remaining cash flows. This then calculated the NPV at $50,306,045.12. Saved to y Mac Module4D scussion Work View Home 1. maste Insert Page Layout Calibri (Body) 12 B IU Formulas Data - A- A- = G A : Review = 2 3 General $ . % 2. Com 2 . ) Conditional Format Formatting as Table SE A Income Statement With New Phone S $ S $ Sales Nariable Costs) (Fixed Costs) (Depreciation) EBIT 5 Taxes (21) Net Income 8 Depreciation. 9 OCF S 96,900,000.00 43,525,000.00 10,700,000.00 6,216,150.00 36,458,850.00 7,656,358.50 28,802,491.50 6,216,150.00 35,018,641.50 $ $ $ $ $ $ $ $ $ 94,725,000.00 $ 66,875,000.00 $50,825,000.00 $ 40,125,000.00 40,650,000.00 $ 27,500,000.00 $ 20,900,000.00 $16,500,000.00 10,700,000.00 $ 10,700,000.00 $10,700,000.00 $ 10,700,000.00 9,130,814.87 $ 4,923,965,85 $ 2,901,310.75 $ 1,815,268.84 34,244,185.14 $ 23,751,034.15 $ 16,323,689.25 $11,109,731.16 7,191,278.88 $ 4,987,717.17 S 3,427,974.74 $ 2,333,043.54 27,052,906.26 $ 18,763,316.98 $ 12,895,714.50 $ 8,776,687.62 9,130,814.87 $ 4,923,965,85 $ 2,901,310.75 $ 1,815,268.84 36,183,721.12 $ 23,687,282.83 $ 15,797,025.26 $ 10,591,956.46 $ $ S $ Net Working Capital Net Warbincanta Yes 3 Initial NWC 24 Ending MWC 25 NWC Cash Flow $ $ S (43,500,000.00 $ (43,500,000,00) $ (43,500,000.00) $124,120,000,00) $ (5,175,000,00) $ 8,200,000.00 19,380,000.00 $ 18,945,000.00 $13,375,000.00 $ 10,165,000.00 (24,120,000.00) $ (5,175,000.00) $ ,200,000.00 $ 18,365,000.00 $18,365,000.00 $ 8.025,000.00 $ 26,390,000.00 Project Cash Flows 28 Year 29 OCH 30 Change in NWC Capital Spending 32 Total Cash Flow $ 23,687,282.83 $ 8,200,000.00 $15,797,025.26 $ 18,365,000.00 $10.591.956.46 $ 26, 190,000.00 $ 35,018,641.50 436,183,721.12 OS (24,120,000.00) S (5,175,000.00 (43,500,000.00) (43,500,000.00 $ 10,898,641.50 $ 31,003,721.12 $ $ $31,287,282.83 $ 34,162,025.26 $ 36,081,956.46 34 Calculate IRR 48% This was caldated by using the IRR function and selecting the total cash flow values for each year $50, 306,045.12 This was calculated by using the NPV function with a rate of 12% and the cash flow values for each year