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Only 2 problems left until i finish please help me if you can thanks a bunch!! Caspian Sea Drinks is considering the production of a
Only 2 problems left until i finish please help me if you can thanks a bunch!!
Caspian Sea Drinks is considering the production of a diet drink. The expansion of the plant and the purchase of the equipment necessary to produce the diet drink will cost $24.00 million. The plant and equipment will be depreciated over 10 years to a book value of $3.00 million, and sold for that amount in year 10. Net working capital will increase by $1.22 million at the beginning of the project and will be recovered at the end. The new diet drink will produce revenues of $9.32 million per year and cost $2.44 million per year over the 10-year life of the project Marketing estimates 18.00% of the buyers of the diet drink will be people who will switch from the regular drink. The marginal tax rate is 22.00%. The WACC is 12.00%. Find the NPV (net present value) Submit Answer format: Currency: Round to: 2 decimal places. Caspian Sea Drinks is considering the production of a diet drink. The expansion of the plant and the purchase of the equipment necessary to produce the diet drink will cost $28.00 million. The plant and equipment will be depreciated over 10 years to a book value of 1.00 million, and sold for that amount in year 10. Net working capital will increase by $1.43 milion at the beginning of the project and will be recovered at the end. The new diet drink will produce revenues of $9.12 million per year and cost $2.15 million per year over the 10-year life of the project Marketing estimates 13.00% of the buyers of the diet drink will be people who will switch from the regular drink. The marginal tax rate is 32.00%. The WACC is 15.00% Find the IRR (internal rate of return) Submit Answer format: Percentage Round to 4 decimal places (Example: 9 2434% % sign required Will accept decimal formar rounded to 6 decimal places (ex 0.092434)) Step by Step Solution
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