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Investment A Initial Expenditure Year#1 Year#2 Year#3 Year#4 Year#5 Net Investment Cost ($800,000) Additional Revenue $100,000 $200,000 $300,000 $450,000 $600,000 Additional Operating Expenses ($40,000) ($40,000)

Investment A
Initial Expenditure Year#1 Year#2 Year#3 Year#4 Year#5
Net Investment Cost ($800,000)
Additional Revenue $100,000 $200,000 $300,000 $450,000 $600,000
Additional Operating Expenses ($40,000) ($40,000) ($40,000) ($40,000) ($40,000)
Amortization ($120,000) ($176,000) ($168,000) ($168,000) ($168,000)
Net Increase in Income ($800,000) ($60,000) ($16,000) $92,000 $242,000 $392,000
Less: Tax@33% ($30,360) ($79,860) ($129,360)
Increase in Aftertax Income ($60,000) ($16,000) $61,640 $162,140 $262,640
Add back Amortization $120,000 $176,000 $168,000 $168,000 $168,000
Net Change in CashFlow ($800,000) $60,000 $160,000 $229,640 $330,140 $430,640
WACC 8.00%
Year#1 Year#2 Year#3 Year#4 Year#5
Internal Rate of Return (IRR)
Net Present Value (NPV)
Payback Period

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