Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please show all formulas and calculations - Thanks Calculate the NPV of the following 7yr project Project Life in yrs 7 Year 1 2 3

Please show all formulas and calculations - Thanks

Calculate the NPV of the following 7yr project

Project Life in yrs 7 Year 1 2 3 4 5 6 7
Sales Forecast $ 8,250,000 Growth Rates for Sales 17.25% 15.80% 13.45% 14.20% 11.60% 10.90%
COGS as % of Sales 52.50% Sales
Cap Invest $ 9,000,000 Cogs
Salvage Value $ 1,750,000 Depr
Beg NWC $ 470,000 EBIT
NWC as % of Sales 1.05% Taxes
WACC 10.75% Net Income
Tax Rate 41.00%
Rental Option/yr $ 55,000
Year 0
OCF
Life for Depr 9.00 Cap Invest
Depr per yr $ 1,000,000 NWC
Book Value at End $ 2,000,000 Salvage Value
Opportunity Cost
FCF
NPV

image text in transcribed

Project Lite in yrs Sales Forecast COGS as of Sales Cap Invest Salvage Value Beg NWC NWC as of Sales WACC Tax Rate Rental option/yr Life for Depr Depr per yr Book Value at End Year 8,250,000 Growth Rates for Sales 17.25% 15.80% 13.45% 14.20% 11.60% 10.90% 52.50% Sales 9,000,000 Cogs 1,750,000 Depr EBIT 470,000 1.05% Taxes 10.75% Net Income 41.00% 55,000 Year OCF 9.00 Cap Invest 1,000,000 NWC 2,000,000 Salvage Value Opportunity Cost FCF NPV

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Essential Personal Finance A Practical Guide For Students

Authors: Lien Luu, Jonquil Lowe, Jason Butler, Tony Byrne

1st Edition

1138692956, 978-1138692954

More Books

Students also viewed these Finance questions

Question

10:16 AM Sun Jan 29 Answered: 1 week ago

Answered: 1 week ago