Proforma Income Statement and Capital Budgeting

Huffman Systems has forecasted the following sales for home alarm systems to be $63,000$ units in Year $1.$

$-$ Sales volume is to increase by $10\%$ year on year, and decreases by $5\%$ in the final $2$ years.

$-$ The cost per unit is RM$40$ per unit and is estimated to increase by $4\%$ year on year.

$-$ The cost of goods sold is $35\%$ of the selling price.

$-$ The fixed cost per year is RM$500,000.$

$-$ The company's interest expenses per year is RM$75,000$

$-$ To produce the new product, the company spend RM$800,000$ on manufacturing equipment, with additional RM$50,000$ on installation of the equipment.

$-$ The equipment is to be depreciated based on MACRS, $7-$year schedule, and will be sold at the end of Year $7$ for $15\%$ of the purchase price.

$-$ The project cost is RM$1\mathrm{.}2$ million, with additional working capital requirement of $10\%$ of the project cost.

$-$ The cost of capital is $7\mathrm{.}12\%,$ and the tax rate is $24\%.$

$1.$ Total asset cost to be depreciated is RM$\_\_\_\_\_\_\_\_\_\_\_\_.$

$2.$ Depreciation expenses in Year $3$ is RM$\_\_\_\_\_\_\_\_\_\_.$

$3.$ Accumulated Depreciation in Year $5$ is RM$\_\_\_\_\_\_\_\_\_\_.$

$4.$ Book Value in Year $6$ is RM$\_\_\_\_\_\_\_\_\_\_.$

$5.$ The disposal price is RM$\_\_\_\_\_\_\_\_\_\_\_.$

$6.$ The Gain$/$ Loss on Disposal is RM$\_\_\_\_\_\_\_\_\_\_\_.$

$7.$ The After tax cash flow$/$ tax shield from the disposal of the asset is RM$\_\_\_\_\_\_\_\_\_\_.$

$8.$ The sales volume in Year $5$ is $\_\_\_\_\_\_\_\_\_$ units.

$9.$ The sales volume in Year $7$ is $\_\_\_\_\_\_\_\_\_$ units.

$10.$ Sales Revenues in Year $2$ is RM$\_\_\_\_\_\_\_\_\_\_\_\_\_.$

$11.$ Sales Revenues in Year $4$ is RM$\_\_\_\_\_\_\_\_\_\_\_\_\_.$

$12.$ The EBIT in Year $3$ is RM$\_\_\_\_\_\_\_\_\_\_.$

$13.$ The EBT in Year $6$ is RM$\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.$

$14.$ The OCF in Year $7$ is RM$\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_.$

$15.$ The initial outlay of the project is RM$\_\_\_\_\_\_\_\_\_\_\_\_\_.$

$16.$ The terminal value of the project is RM$\_\_\_\_\_\_\_\_\_\_\_\_\_.$

$17.$ Total Present Value of the project is RM$\_\_\_\_\_\_\_\_\_\_\_\_\_.$

$18.$ Total Future Value of the project is RM$\_\_\_\_\_\_\_\_\_\_\_\_\_.$

$19.$ Payback Period is $\_\_\_\_\_\_\_\_\_\_\_.$

$20.$ Discounted Payback Period is $\_\_\_\_\_\_\_\_\_\_\_.$

$21.$ NPV is RM$\_\_\_\_\_\_\_\_\_\_\_\_\_.$

$22.$ PI is RM$\_\_\_\_\_\_\_\_\_\_\_\_\_.$

$23.$ IRR is $\_\_\_\_\_\_\_\_\%.$

$24.$ MIRR is $\_\_\_\_\_\_\_\_\%.$

$25.$ EAA of the project is RM$\_\_\_\_\_\_\_\_\_\_\_\_.$