Question 4

In light of the increased awareness for the need to adapt to climate change, you have been asked to determine the viability of an investment of $410,000,000 in Environ4Us Ltd which manufactures large batteries for storing solar energy.You have obtained the following data about their main project which is expected to operate for 5 years. Specifically, you are required to use 2 different financial modelling techniques to evaluate this possible investment.

Year

Cash sales ($000s)

Cash expenses ($000s)

Depreciation ($000s)

Net profit before tax ($000s)

Tax @ 30%($000s)

Annual Cash Flow

($000s)

1

450,000

290,000

70,000

2

525,000

305,000

60,000

3

550,000

320,000

50,000

4

595,000

400,000

45,000

5

620,000

440,000

40,000

You have been advised that the minimum after tax rate of return is 10% and the tax rate is 30%.

(a)Complete the table above and calculate the net present value

Payments To Manager Team Email V Done FNSINC601 Assignment Student Copy - 2.4 - Word Sofija Milanovic X File Home Insert Design Layout References Mailings Review View Help BLUEBEAM Design Layout Tell me Share Calibri A Create PDF B I U ~ abc X, x Change Settings Paste A" A" Styles Editing A - y . A Aa ~ Batch PDF Clipboard Font Paragraph Styles Bluebeam Question 4 In light of the increased awareness for the need to adapt to climate change, you have been asked to determine the viability of an investment of $410,000,000 in Environ4Us Led which manufactures large batteries for storing solar energy. You have obtained the following data about their main project which is exp ecifically, you are required to use 2 different financial modelling techniques to evaluate this possible investment. Year Cash sales Cash expenses | Depreciation Net profit Tax @ Annual Cash ($000s) ($000s) ($000s) before tax 30% Flow ($000s) ($000s) 450,000 290,00 70,000 525,000 305,000 60,000 550,000 320,000 50,000 595,000 400,000 45,000 620,000 440,000 40,000 You have been advised of return is 10% and the tax rate is 30%. (a) Complete the table above and calculate the net present value Page 12 of 16 3035 words 8 English (Australia) 100% All folders are up to date. Conn