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I have seen answers to this question already but I am looking to what formulas I need to oenter in the excel, especially in the
I have seen answers to this question already but I am looking to what formulas I need to oenter in the excel, especially in the lower table section. Thank you
Problem 9-4 Present Value and "What Ifs Analysis - See Textbook page 9-30 National Cruise Line, Inc. is considering the acquisition of a new ship that will cost 600,000,000. In this regard, the president of the company asked the CFO to analyze cash flows associated with operating the ship under two alternative itineraries: Itinerary 1, Caribbean Winter/Alaska Summer and Itinerary 2 Caribbean Winter/Eastern Canada Summer. The CFO estimated the following cash flows, which are expected to apply to each of the next 15 years. Caribbean/ Caribbean/Alaska Eastern Canada $ 120,000,000 $ 105,000,000 Net revenue Less: Direct program expenses Indirect program expenses Non-operating expenses Add back depreciation Cash flow per year (25,000,000) (24,000,000) (20,000,000) (20,000,000) (21,000,000) (21,000,000) 115,000,000 115,000,000 $ 169,000,000 $ 155,000,000 The estimated cost of the new ship and expected cash flows are: Estimated cost of new ship Estimated period of cash flows in years $ 600,000,000 15 Required a. For each of the itineraries, calculate the present values of the cash flows using required rates of return of both 12 and 16% using both present value factors and separately using Excel PV function. Assume a 15-year time horizon. Should the company purchase the ship with either or (Use Appendix Table B9.2 to arrive at the factor) a. For each of the itineraries, calculate the present values of the cash flows using required rates of return of both 12 and 16% using both present value factors and separately using Excel PV function. Assume a 15-year time horizon. Should the company purchase the ship with either or (Use Appendix Table B9.2 to arrive at the factor) Caribbean/Alaska 12% Cash Flow Factor X 16% Caribbean/ Eastern Canada 12% 16% X Caribbean/Alaska 12% Caribbean/ Eastern Canada 12% 16% 16% Rate Number of periods Cash Flow Future value Type $0 0 $0 0 $0 0 $0 0 PV For the PV values in cells D49,E49, F49, G49, use the Microsoft Excel functions. If you need help with the Excel function, See Appendix A or the Excel videos. Appendix A and the Excel videos show how to use the FORMAT and FINANCIAL tabs in Excel to choose a multitude of Excel functions** Should the company purchase the ship with either or both required rates of return? ExplainStep by Step Solution
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