Question
Inputs Base Case Equipment Cost $3,400.00 Project Length 4 Years Straight Line Depreciation $850.00 Salvage Value, Year 4 $300.00 Units Sold, Year 1 550.00 Sales
Inputs | Base Case |
Equipment Cost | $3,400.00 |
Project Length | 4 Years |
Straight Line Depreciation | $850.00 |
Salvage Value, Year 4 | $300.00 |
Units Sold, Year 1 | 550.00 |
Sales price per unit, Year 1 | $11.60 |
Annual change in sales price, after Year 1 | 2.0% |
Variable cost per unit (VC), Year 1 | $6.00 |
Annual change in VC, after Year 1 | 2.0% |
Fixed Cost (FC), Year 1 | $2,000.00 |
Annual change in FC, after Year 1 | 2.0% |
Project WACC | 11.85% |
Tax Rate | 40.0% |
Working Capital as % of next year's sales | 12.00% |
Put together a Capital Budget Analysis.
Prepare the following return analysis:
1). Net Present Value
2). Internal Rate of Return
3). Profitability Index
4). Payback in Years
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