please help with all blanks. including NVP

AutoSave OF CH09_SM_5e_Student - Compatibility Mode Search Insert Draw Formulas Page Layout Data Review Home View ile Developer Help QuickBooks Arial 10 ' ' 29 Wrap Text General X Cut LEcopy aste Format Painter Clipboard B TV Merge & Center $ % 0 8 Conditional Format as Cell Formatting Table Styles Styles Alignment Number Font 21 fr G D 1 H C After spending $10.000 on client-development, you have just been offered a big production contract by a new client. The contract will add $200,000 to your revenues for each of the next 5 years and it will cost you $100,000 per year to make the additional product. You will have to use some existing equipment and buy new equipment as well. The existing equipment is fully depreciated, but could be sold for $50,000 now. If you use it in the project, it will be worthless at the end of the project. You will buy new equipment valued at $30.000, put it into use in year 1, and use the S-year MACRS schedule to depreciate it. It will be worthless at the end of the project. Your current production manager carns $80,000 per year. Since she is busy with ongoing projects, you are planning to hire an assistant at $40,000 per year to help with the expansion. You will have to immediately increase your inventory from $20,000 to $30.000. It will return to $20.000 at the end of the project. Your company's tax rate is 21% and your discount rate is 15%. What is the NPV of the contract? Year 1 3 0 5 4 D Depreciation MACRS Schedule Depreciation NPV 20.00% 6,000 32.00% 9,600 19.2096 5,760 11.52% 3,456 11.52% 3,456 5.76% 1,728 Year Without Projec U 1 5 2 4 3 20,000 30,000 Change in NWC Net Working Capital Change in NWC Cash Flow 30,000 10,000 10,000 U 0 30,000 0 0 30,000 0 U 30,000 0 0 20,000 10,000 10.000 0 Year Revenues Costs Salary Depreciation Taxable income Tax 21% - 9-12 9-139-14 9-179189-27 2 200,000 200,000 100,000 100,000 40,000 40,000 6,000 9,600 54,000 50,400 11,340 10,584 9-28 19:299-309-31 9-329-33 4 200,000 200,000 100,000 100,000 40,000 40,000 5,760 3,456 54,240 56,544 11,390 11,874 Scenario Summary 5 200,000 100,000 40,000 3,456 56,544 11,874 1,728 1.728 363 Type here to search toSave On CHO9 SM_Se_Student. Compatibility Mode - Search Home Insert Draw Page Layout Formulas Data Review View Developer Help QuickBooks Arial 10 A ' ' Wrap Text General X Out Copy Format Painter Clipboard 15 BIU FH Merge & Center $% 9 088 Insc Conditional Formatas Cell Formatting Table Styles Font Alignment Number Styles JN B D E G H 1 Year 0 K 1 2 3 4 5 6 Depreciation MACRS Schedule Depreciation NPV 20.00% 6,000 32.00% 9.600 19.20% 5,760 11.52% 3,456 11.529 3.456 5.76% 1.728 Year Without Projec 0 1 2 3 4 3 Change in NWC Net Working Capital Change in NWC Cash Flow 20,000 30,000 30,000 10,000 -10,000 30,000 0 0 U 30,000 0 U 30,000 0 0 20,000 10,000 10,000 0 Year 0 6 1 200,000 100,000 -40,000 6,000 54,000 11,340 12,660 Revenues Costs Salary Depreciation Taxable income Tax Net Income Add back Depreciation CapEx Opportunity Cost CF from Change NWC FCF 2 200,000 100,000 40.000 9,600 50,400 10,584 39,816 9,600 3 200,000 -100,000 40.000 -5,760 54,240 11,390 12,850 3,760 4 200,000 100,000 40.000 -3,456 56,544 11,874 44,670 3.456 5 200,000 -100,000 -40,000 3,456 56,544 11,874 44,670 3,456 21% 1,728 1,728 363 1,365 1,728 0,000 30,000 39,500 10,000 U O U 0 10,000 0 NPV 0.00 9-12 9-139-14 9-17 9-18 9-279-28 9:29 9-30 9-319-32 9-33 Scenario Summary Type here to search o RE S % AutoSave OF CH09_SM_5e_Student - Compatibility Mode Search Insert Draw Formulas Page Layout Data Review Home View ile Developer Help QuickBooks Arial 10 ' ' 29 Wrap Text General X Cut LEcopy aste Format Painter Clipboard B TV Merge & Center $ % 0 8 Conditional Format as Cell Formatting Table Styles Styles Alignment Number Font 21 fr G D 1 H C After spending $10.000 on client-development, you have just been offered a big production contract by a new client. The contract will add $200,000 to your revenues for each of the next 5 years and it will cost you $100,000 per year to make the additional product. You will have to use some existing equipment and buy new equipment as well. The existing equipment is fully depreciated, but could be sold for $50,000 now. If you use it in the project, it will be worthless at the end of the project. You will buy new equipment valued at $30.000, put it into use in year 1, and use the S-year MACRS schedule to depreciate it. It will be worthless at the end of the project. Your current production manager carns $80,000 per year. Since she is busy with ongoing projects, you are planning to hire an assistant at $40,000 per year to help with the expansion. You will have to immediately increase your inventory from $20,000 to $30.000. It will return to $20.000 at the end of the project. Your company's tax rate is 21% and your discount rate is 15%. What is the NPV of the contract? Year 1 3 0 5 4 D Depreciation MACRS Schedule Depreciation NPV 20.00% 6,000 32.00% 9,600 19.2096 5,760 11.52% 3,456 11.52% 3,456 5.76% 1,728 Year Without Projec U 1 5 2 4 3 20,000 30,000 Change in NWC Net Working Capital Change in NWC Cash Flow 30,000 10,000 10,000 U 0 30,000 0 0 30,000 0 U 30,000 0 0 20,000 10,000 10.000 0 Year Revenues Costs Salary Depreciation Taxable income Tax 21% - 9-12 9-139-14 9-179189-27 2 200,000 200,000 100,000 100,000 40,000 40,000 6,000 9,600 54,000 50,400 11,340 10,584 9-28 19:299-309-31 9-329-33 4 200,000 200,000 100,000 100,000 40,000 40,000 5,760 3,456 54,240 56,544 11,390 11,874 Scenario Summary 5 200,000 100,000 40,000 3,456 56,544 11,874 1,728 1.728 363 Type here to search toSave On CHO9 SM_Se_Student. Compatibility Mode - Search Home Insert Draw Page Layout Formulas Data Review View Developer Help QuickBooks Arial 10 A ' ' Wrap Text General X Out Copy Format Painter Clipboard 15 BIU FH Merge & Center $% 9 088 Insc Conditional Formatas Cell Formatting Table Styles Font Alignment Number Styles JN B D E G H 1 Year 0 K 1 2 3 4 5 6 Depreciation MACRS Schedule Depreciation NPV 20.00% 6,000 32.00% 9.600 19.20% 5,760 11.52% 3,456 11.529 3.456 5.76% 1.728 Year Without Projec 0 1 2 3 4 3 Change in NWC Net Working Capital Change in NWC Cash Flow 20,000 30,000 30,000 10,000 -10,000 30,000 0 0 U 30,000 0 U 30,000 0 0 20,000 10,000 10,000 0 Year 0 6 1 200,000 100,000 -40,000 6,000 54,000 11,340 12,660 Revenues Costs Salary Depreciation Taxable income Tax Net Income Add back Depreciation CapEx Opportunity Cost CF from Change NWC FCF 2 200,000 100,000 40.000 9,600 50,400 10,584 39,816 9,600 3 200,000 -100,000 40.000 -5,760 54,240 11,390 12,850 3,760 4 200,000 100,000 40.000 -3,456 56,544 11,874 44,670 3.456 5 200,000 -100,000 -40,000 3,456 56,544 11,874 44,670 3,456 21% 1,728 1,728 363 1,365 1,728 0,000 30,000 39,500 10,000 U O U 0 10,000 0 NPV 0.00 9-12 9-139-14 9-17 9-18 9-279-28 9:29 9-30 9-319-32 9-33 Scenario Summary Type here to search o RE S %