Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Project Ellaviah This company is planning to invest in a project called Ellaviah . The management accounting department received the following information Capex $45000 Project

image text in transcribed
Project Ellaviah This company is planning to invest in a project called Ellaviah . The management accounting department received the following information Capex $45000 Project period Syears . Revenue $19000 _ Supplies expense 6000 ' Salary 3500 . Utilities 500 _ Discount Rate 15% Sale of asset @ end of project $20,000 Net working Capital $1900 The compaan tax rate is 12%. The project also earned 55200 as interest revenue. The capital expenditure is depreciated using straight line method over the project and will have a residual value of 515000 . the company will have to rent a building for $4000 during the project life. The net working capital will be returned at the end of the project REQUIRED a] Calculate the initial investment b} Calculate each year cash flow c} Calculate the terminal value of the asset used all Calculate the NPV e] Calculate the Protability Index [Pl] Calculate IRR of the project

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

Managerial Accounting

Authors: James Jiambalvo

7th Edition

1119577721, 978-1119577720

More Books

Students also viewed these Accounting questions