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i need all the years 0-7 and then the NPV. I cant seem to figure it out. yes it has so be like that. the
i need all the years 0-7 and then the NPV. I cant seem to figure it out.
yes it has so be like that. the table is related to it
You work for Apple. After toiling away on $10.6 million worth of prototypes, you have finally produced your answer to Google Glasses: iGlasses (the name alone is genius). IGlasses will instantly transport the wearer into the world as Apple wants him to experience it: iTunes with the wink of an eye and apps that can be activated just by looking at them. You think that these will sell for five years until the next big thing comes along (or until users are unable to interact with actual human beings). Revenues are projected to be $447.6 million per year along with expenses of $353.5 million. You will need to spend $64.5 million immediately on additional equipment that will be depreciated using the 5-year MACRS schedule. Additionally, you will use some fully depreciated existing equipment that has a market value of $10.8 million. As the iGlasses are an outcome of the R&D center, Apple plans to charge $5.5 million of the annual costs of the center to the Glasses product for four years. Finally, Apple's working capital levels will increase from their current level of $122.6 million to $141.1 million immediately. They will remain at the elevated level until year 4, when they will return to $122.6 million. Apple's discount rate for this project is 15.8% and its tax rate is 35%. Calculate the free cash flows and determine the NPV of this project. () The opportunity cost must be after-tax. Calculate the free cash flows below: (Round to two decimal places.) Year Year 1 (5 million) Sales - Cost of Goods Sold Gross Profit - Annual Charge - Depreciation Tearo 0.00 0.00 0.00 0.00 3.23 -3.23 EBIT 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 13.50 $ 56.00 $ 6.31' $ (75.81)' $ 454.60 $ 340.40 $ 114.20 $ 0.00 $ 11.20 $ 103.00 $ 36.05 s 66.95 $ 11.20 $ 0.00 $ 0.00 $ 0.00 $ 78.15 S Year 454.60 $ 340.40 $ 114.20 $ 0.00 $ 17.92 $ 96.28 $ 33.70 $ 62.68 $ 17.92 $ 0.00 $ 0.00 $ 0.00 $ 80,50 $ Tears 454.60 $ 340.40 $ 114.20 $ 0.00 $ 10.75 $ 103.45 $ 36.21 $ 67.24 $ 10.75 $ 0.00 $ 0.00 $ 0.00 $ 77.99 $ Tear 454.60 $ 340.40 $ 114.20 $ 0.00 $ 6.45 $ 107.75 $ 37.71 $ 70.04 $ 6.45 S 0.00 $ 0.00 $ 0.00 $ 76.49 $ Tear 454.60 $ 340.40 $ 114.20 $ 0.00 $ 6.45 $ 107.75 s 37.71 s 70.04 $ 6.45 S (13.50)' $ 0.00 $ 0.00 $ 89.99 $ - Tax -1.13 $ $ -2.10 3.23 0.00 Incremental Earnings + Depreciation Incremental Working Capital - Capital Investment - Opportunity Cost (5) Incremental Free Cash Flow $ 0.00 $ 0.00 1.13 $ The NPV of the project is $ million. (Round to two decimal places.) Enter your answer in the answer box and then click Check Step by Step Solution
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