need help in calculating the math portion

. . . . Ma & Pa Incorporated Expense Estimates (FIN_300) Please note: The data below is based on Andre's original request of examination of an eight year project. You will use these numbers to answer a. thru e. on the Ma & Pa Worksheet. 1. Up-front costs: Andre Russell worked with the top management (Bil. Lucy, Lilian, and Hillary) as well as selected middle manager to arrive at the up-front costs. Based on his discussions with them, he is anticipating the up-front costs to be comprised of the following: Cost of the land: He anticipates that the land will cost about $40.000 per acre and he needs about 5 acres ($200,000 in total). Cost of the building: $1,000,000 Equipment: $250,000 Furniture: $200,000 IT infrastructure: $550.000 Total projected up-front costs: $2,200,000 II. Cost of capital: Andre researched extensively on cost of capital and found: Total projected cost of eapital: S195,000 III. Sales: After working with Elizabeth Brown, Director of Sales and Marketing, and several other managers in her area, Andre is projecting the following sales for the first year. Further, these sales are expected to grow at 10% compounded for the duration of the project. Electronic toys for children: $175.000 Halloween toys: $320.000 Christmas toys: $430,000 Total projected sales: S925,000 tha mort cynenses and projections for future expenses, Andre . . . . . . Halloween toys: $320,000 Christmas toys: $430,000 Total projected sales: $925,000 IV. Cash expenses. Based on the past expenses and projections for future expenses, Andre arrived at the following expenses on an annual basis. For simplicity. Andre assumed that these expenses will grow at 2% annually for the duration of the project. Labor/Employment Expenses: $87.500 Maintenance: $77,500 New equipment: $75,000 IT budget: $70,000 Total projected cash expense: $310,000 V. Depreciation: Andre is expecting that the depreciation will computed as follows: Land value depreciation: $70,000 Building value depreciation: $65,000 Equipment depreciation: $60,000 IT infrastructure depreciation $55,000 Total projected depreciation: $250,000 . . . . Ma & Pa Project Proposal Worksheet Format a 2-page (minimum), double spaced report for Andre from Ma & Pa Incorporated Within your report, be sure to answer all the questions below. Submit your report to the Ma & Pa Incorporated Project Dropbox. Please use the following naming structute: Last Name, First Name Ma Pa (ie. Smith. John Ma & Pa) Use the eight year model, along with Andre's estimates for questions a true. a. At the end of the project, what is Ma & Pa Incorporated's carvings before taxes then! At the current tax rate for Ma & Pa incorporated, what is Ma & Pa Incorporated's net income? 6 Compute the project's after-tax cash flow, Operating cash flow= (Sales - Costs - Depreciation) (1 - 1) + Depreciation - change in net working capital - c. Compute and interpret the project's NPV. IRR. and profitability index. d. According to your above calculations: What is your interpretation on if the project should be accepted or rejected? e. The minimum required rate of return is a weighted average of the firm's costs of various sources of capital. Explain. f. Ma & Pa Incorporated realize that the project depreciation needs to be $290,000 and the follo d. According to your above calculations: What is your interpretation on if the project should be accepted or rejected? e. The minimum required rate of return is a weighted average of the firm's costs of various sources of capital. Explain. f. Ma & Pa Incorporated realize that the project depreciation needs to be $290,000 and the project needs to last 10 years. The depreciation is now computed as followst Land value depreciation: 80,000 Building value depreciation: 75.000 Equipment depreciation: 70.000 IT infrastructure depreciation 65.000 Please compute the new NPV, IRR, and profitability index using the new numbers. g. Assume that they reduced the expenses, but depreciation increased to 350,000 and the project duration decreased to 6 years. Land value depreciation: 100,000 Building value depreciation: 90,000 Equipment depreciation: 85.000 IT infrastructure depreciation 75,000 Please compute the new NPV, IRR, and profitability index using the new numbers. . h. Regarding firm's decision strategies: Between the original eight year scenario, and the scenarios from f' and g (six and 10 year scenarios) - identify which is the best scenario. Please justify your choice using IRR, NPV and PL. General Financial Business Questions Please answer these additional general questions in your report to Andre. i How would the company determine present value? j. For Ma & Pa Incorporated, or any general company, what is the relationship between capital structure and capital budgeting discount rate? k. Discuss the cost of debt financing and cost of equity financing. 1. How does a company compute the cost of capita? . . . . Ma & Pa Incorporated Expense Estimates (FIN_300) Please note: The data below is based on Andre's original request of examination of an eight year project. You will use these numbers to answer a. thru e. on the Ma & Pa Worksheet. 1. Up-front costs: Andre Russell worked with the top management (Bil. Lucy, Lilian, and Hillary) as well as selected middle manager to arrive at the up-front costs. Based on his discussions with them, he is anticipating the up-front costs to be comprised of the following: Cost of the land: He anticipates that the land will cost about $40.000 per acre and he needs about 5 acres ($200,000 in total). Cost of the building: $1,000,000 Equipment: $250,000 Furniture: $200,000 IT infrastructure: $550.000 Total projected up-front costs: $2,200,000 II. Cost of capital: Andre researched extensively on cost of capital and found: Total projected cost of eapital: S195,000 III. Sales: After working with Elizabeth Brown, Director of Sales and Marketing, and several other managers in her area, Andre is projecting the following sales for the first year. Further, these sales are expected to grow at 10% compounded for the duration of the project. Electronic toys for children: $175.000 Halloween toys: $320.000 Christmas toys: $430,000 Total projected sales: S925,000 tha mort cynenses and projections for future expenses, Andre . . . . . . Halloween toys: $320,000 Christmas toys: $430,000 Total projected sales: $925,000 IV. Cash expenses. Based on the past expenses and projections for future expenses, Andre arrived at the following expenses on an annual basis. For simplicity. Andre assumed that these expenses will grow at 2% annually for the duration of the project. Labor/Employment Expenses: $87.500 Maintenance: $77,500 New equipment: $75,000 IT budget: $70,000 Total projected cash expense: $310,000 V. Depreciation: Andre is expecting that the depreciation will computed as follows: Land value depreciation: $70,000 Building value depreciation: $65,000 Equipment depreciation: $60,000 IT infrastructure depreciation $55,000 Total projected depreciation: $250,000 . . . . Ma & Pa Project Proposal Worksheet Format a 2-page (minimum), double spaced report for Andre from Ma & Pa Incorporated Within your report, be sure to answer all the questions below. Submit your report to the Ma & Pa Incorporated Project Dropbox. Please use the following naming structute: Last Name, First Name Ma Pa (ie. Smith. John Ma & Pa) Use the eight year model, along with Andre's estimates for questions a true. a. At the end of the project, what is Ma & Pa Incorporated's carvings before taxes then! At the current tax rate for Ma & Pa incorporated, what is Ma & Pa Incorporated's net income? 6 Compute the project's after-tax cash flow, Operating cash flow= (Sales - Costs - Depreciation) (1 - 1) + Depreciation - change in net working capital - c. Compute and interpret the project's NPV. IRR. and profitability index. d. According to your above calculations: What is your interpretation on if the project should be accepted or rejected? e. The minimum required rate of return is a weighted average of the firm's costs of various sources of capital. Explain. f. Ma & Pa Incorporated realize that the project depreciation needs to be $290,000 and the follo d. According to your above calculations: What is your interpretation on if the project should be accepted or rejected? e. The minimum required rate of return is a weighted average of the firm's costs of various sources of capital. Explain. f. Ma & Pa Incorporated realize that the project depreciation needs to be $290,000 and the project needs to last 10 years. The depreciation is now computed as followst Land value depreciation: 80,000 Building value depreciation: 75.000 Equipment depreciation: 70.000 IT infrastructure depreciation 65.000 Please compute the new NPV, IRR, and profitability index using the new numbers. g. Assume that they reduced the expenses, but depreciation increased to 350,000 and the project duration decreased to 6 years. Land value depreciation: 100,000 Building value depreciation: 90,000 Equipment depreciation: 85.000 IT infrastructure depreciation 75,000 Please compute the new NPV, IRR, and profitability index using the new numbers. . h. Regarding firm's decision strategies: Between the original eight year scenario, and the scenarios from f' and g (six and 10 year scenarios) - identify which is the best scenario. Please justify your choice using IRR, NPV and PL. General Financial Business Questions Please answer these additional general questions in your report to Andre. i How would the company determine present value? j. For Ma & Pa Incorporated, or any general company, what is the relationship between capital structure and capital budgeting discount rate? k. Discuss the cost of debt financing and cost of equity financing. 1. How does a company compute the cost of capita