Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Scenario: Your client owns a successful (well, pre-COVID!) restaurant in downtown Chicago. She wants to open a 2nd restaurant in the suburbs and has asked

image text in transcribed

Scenario: Your client owns a successful (well, pre-COVID!) restaurant in downtown Chicago. She wants to open a 2nd restaurant in the suburbs and has asked you to help her choose between two locations. Key information is listed below. Using the four capital budgeting methods that we know, prepare a presentation that shows your recommendations to your client (and why). Oak Park Rosemont Initial Investment: 4,000,000 4,000,000 Annual cash inflows: $1,000,000 $1,200,000 Annual cash outflows: $600,000 $850,000 Annual non-cash (all depreciation) expenses: Use straight line depreciation to find! 25 30 # of years of expected useful life of project: For both, assume no residual value and: 10% Discount Rate Use textbook Exhibit 14B-2 (or the annuity document/chart in this module) where applicable. PROJECT 2 REQUIREMENTS: Prepare a PowerPoint presentation and/or a YouTube or Zoom video that you would give/show to your client that clearly identifies your recommendation as to which location she should select to open her second restaurant. Additional MUST HAVES, include clearly identified calculations of the four capital budgeting methodologies (showing your work, not the work of Google or Excel programmers!) we have used in this module, and sufficient information on what these metrics mean, particularly as it relates to your preference decision. Scenario: Your client owns a successful (well, pre-COVID!) restaurant in downtown Chicago. She wants to open a 2nd restaurant in the suburbs and has asked you to help her choose between two locations. Key information is listed below. Using the four capital budgeting methods that we know, prepare a presentation that shows your recommendations to your client (and why). Oak Park Rosemont Initial Investment: 4,000,000 4,000,000 Annual cash inflows: $1,000,000 $1,200,000 Annual cash outflows: $600,000 $850,000 Annual non-cash (all depreciation) expenses: Use straight line depreciation to find! 25 30 # of years of expected useful life of project: For both, assume no residual value and: 10% Discount Rate Use textbook Exhibit 14B-2 (or the annuity document/chart in this module) where applicable. PROJECT 2 REQUIREMENTS: Prepare a PowerPoint presentation and/or a YouTube or Zoom video that you would give/show to your client that clearly identifies your recommendation as to which location she should select to open her second restaurant. Additional MUST HAVES, include clearly identified calculations of the four capital budgeting methodologies (showing your work, not the work of Google or Excel programmers!) we have used in this module, and sufficient information on what these metrics mean, particularly as it relates to your preference decision

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_2

Step: 3

blur-text-image_3

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

Fundamentals Of Cost Accounting

Authors: T.R.Sikka

7th Edition

8130918706, 978-8130918709

More Books

Students also viewed these Accounting questions