Pakco Corp. is a manufacturer of travel bags. It is evaluating entering into the manufacture of a new line of backpacks. This will require the investment in a new manufacturing machine and hiring additional employees. You are a financial analyst in the Financial Planning & Analysis Department. The product development team has supplied you with the below growth rates and margins and it expects year 1 revenues to be $10,000.0 thousand. You are to complete an analysis to determine the net present value and internal rate of return on the project. You are also to complete the below data table for differtent levels of COGS % and required rates of return as outlined. As shown to the left the cost of the machine is $15,500 thousand, Tax rate is 25% and the required rate of return is 12%. (SOLVE WITHIN EXCEL)

Pakco Corp. - CAPITAL PROJECT ANALYSIS Sin thousand Cost of machine $ 15,500.0 The machine will have no sale/residual value at the end of year 10 Tax Rate 25% Required Rate of Return 12% Pakco Corp. is a manufacturer of travel bags. It is evaluating entering into the manufacture of a new line of backpacks. This will require the investment in a new manufacturing machine and hiring additional employees. You are a financial analyst in the Financial Planning & Analysis Department. The product development team has supplied you with the below growth rates and margins and it expects year 1 revenues to be $10,000.0 thousand. You are to complete an analysis to determine the net present value and internal Tale of return on the projell. You are alsu lu currplele the below data table for differtent levels of COGS % and required rates of return as outlined. As shown to the left the cost of the machine is $15,500 thousand, Tax rate is 25% and the required rate of return is 12%. PERIOD 0 1 2 3 5 6 1 8 9 10 $ n/a 5.096 5.0% 5.0% 5.0% 5.0% -10.0% -25.0% -30.0% -35.0% 65 096 65 0% 65 0% 65 09 65 096 65 096 65 096 65 096 65 096 65 096 2.596 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% 2.5% Revenue Revenue Growth Assumptions 100 COGS COGS as a % of Revenue SG&A Expenses SG&A Expenses as a % of Revenue Depreciation Fxpense Tax Depreciation MACRS % Pre-Tax Income from Project Taxes After-Tax Income Add: Depreciation Cash Flow 20.09 32.0% 19.0% 12.0% 12.09 5.0% Net Present Value Internal Rate of Return DATA TABLE COGS % NPV 62.0% 63.0% 64.0% 65.0% 66.0% 67.0% Required Return 11.0% 11.5% 12.0% 12.5% 13.0%