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How do you find 'BEST CASE NPV' and 'WORST CASE NPV'? please tell me thankyou We are evaluating a project that costs $845,000, has an
How do you find 'BEST CASE NPV' and 'WORST CASE NPV'? please tell me thankyou
We are evaluating a project that costs $845,000, has an eight-year life, and has no salvage value, Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 51,000 units per year. Price per unit is $53, variable cost per unit 2 is $27, and fixed costs are $950,000 per year. The tax rate is 22 percent, and we require a return of 10 percent on this project. Suppose the projections given for price, quantity, variable costs, and fixed costs are all accurate to within \pm 10 percent. Calculate the best-case and worst-case NPV figures. 3 4 5 6 7 8 9 16 11 12 13 18 (Use cells A6 to B17 from the given information to complete this question. You must use the built-in Excel function to answer this question. The OCF must be calculated using the depreciation tax shield approach.) 21 22 Output area: 23 24. 25 26 27 \begin{tabular}{|c|c|c|c|c|c|c|c|c|c|} \hline Scenario & & Unit sales & & Unit price & & Unit var & riable cost & & Fixed costs \\ \hline Best-case & r & $56,100 & r & $58.30 & r & & $24,30 & r & $855,000 \\ \hline Worst-case & r & $45,900 & r & $47.70 & r & 8 & $29.70 & r & $1,045,000 \\ \hline Best-case OCF & r & $844,109.50 & & & & & & & \\ \hline Best-case NPV & C & & & & & & 8 & & \\ \hline Worst-case OCF & r & ($147,426,50) & & & & & & 8 & \\ \hline Worst-case NPV & C & & & & & & & & \\ \hline \end{tabular} We are evaluating a project that costs $845,000, has an eight-year life, and has no salvage value, Assume that depreciation is straight-line to zero over the life of the project. Sales are projected at 51,000 units per year. Price per unit is $53, variable cost per unit 2 is $27, and fixed costs are $950,000 per year. The tax rate is 22 percent, and we require a return of 10 percent on this project. Suppose the projections given for price, quantity, variable costs, and fixed costs are all accurate to within \pm 10 percent. Calculate the best-case and worst-case NPV figures. 3 4 5 6 7 8 9 16 11 12 13 18 (Use cells A6 to B17 from the given information to complete this question. You must use the built-in Excel function to answer this question. The OCF must be calculated using the depreciation tax shield approach.) 21 22 Output area: 23 24. 25 26 27 \begin{tabular}{|c|c|c|c|c|c|c|c|c|c|} \hline Scenario & & Unit sales & & Unit price & & Unit var & riable cost & & Fixed costs \\ \hline Best-case & r & $56,100 & r & $58.30 & r & & $24,30 & r & $855,000 \\ \hline Worst-case & r & $45,900 & r & $47.70 & r & 8 & $29.70 & r & $1,045,000 \\ \hline Best-case OCF & r & $844,109.50 & & & & & & & \\ \hline Best-case NPV & C & & & & & & 8 & & \\ \hline Worst-case OCF & r & ($147,426,50) & & & & & & 8 & \\ \hline Worst-case NPV & C & & & & & & & & \\ \hline \end{tabular} Step by Step Solution
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