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Posted on Jul 24, 2024

Should Rodriguez be more of less critical of cash flow forecasts for Persistence than of cash flow forecasts for Sneaker 2013? Why? Based on NPV

Should Rodriguez be more of less critical of cash flow forecasts for Persistence than of cash flow forecasts for Sneaker 2013? Why? Based on NPV and IRR of each project, which project looks better for the shareholders? Why? Sneaker Project 2012 Operating Cash Flow Year Pairs Sold Per Unit Sale Amount Sales Revenue Lost Sales Net Sales 2013 1.200.000,00 $190.00 5228,000,000.00 $35.000.000.00 5193.000.000.00 2014 1.500,000.00 $190 00 $304.000.000.00 $15.000.000.00 5289.000.000.00 2015 1,400,000.00 $190.00 5266,000,000.00 50.00 5266.000.000.00 2016 2.400,000.00 $190 00 5456.000.000.00 5000 3456.000.000.00 2017 1.800.000,00 $190.00 5342.000.000.00 50.00 $342.000.000.00 2018 900,000.00 $190.00 $171,000,000.00 50 00 5171.000.000,00 Gross Margin (40% of sales) Gross Margin Lost Gross Margin 591,200.000.00 $14.000.000,00 577,200.000.00 5121,600,000.00 5106,400,000.00 $6.000.000.00 $0.00 5115,600,000.00 5106,400.000 00 $162.400,000.00 50.00 $162.400,000 00 5136.800.000.00 $0.00 $136.000 000 00 568.400,000.00 50.00 560.400,000.00 Less: Expenses Seling. General & Admin Expenses Interest Kirani James Payment AAP Expense 37.000.000.00 $1.200.000,00 37.000.000.00 $1.200.000.00 200.000.00 STUDIO $7.000.000.00 1,200,000.00 32.000.000.00 SHOULUT 00 00 37.000,000.00 31.200,000.00 53,000,000.00 530 000.000.00 $7.000.000.00 $1.200.000,00 $2.000.000.00 525.000.000.00 57.000.000.00 51.200,000.00 $2.000.000.00 515 000 000 00 STUDIO Total Depreciation Profit Before Tax Tax (40%) Proft After Tax $7.900.000.00 $41,100.000,00 $16,440.000.00 $24.560,000.00 $13,900,000.00 $83.500,000.00 $33,400,000.00 $50,100,000.00 $10,850,000.00 $82,350,000.00 $32.940,000.00 $49.410.000.00 39,150,000.00 $139,050,000.00 $55.620,000.00 $83.430,000.00 58,650,000.00 $99,950,000.00 $39,900,000.00 $59.970,000.00 $7.200,000.00 $43.000.000.00 $17.200,000.00 $25.800,000.00 Add Back Depreciation Operating Cash Flow $7,900 000.00 $32.560 000.00 $13.900,000.00 564,000,000.00 $10,850,000.00 $60,260 000.00 9, 150,000.00 592.580,000.00 58,650.000.00 $68,620.000.00 $7.200,000.00 $33.000.000.00 Working Capital Requirements: Variable Costs (55% sales revenue) Inventory (25% of variable costs) Accounts Receivable (8% revenue) Accounts Payable (20% revenue) Increase in NWC: $125,400.000,00 $167.200,000.00 $146,300,000.00 $31,350.000.00 $41.800,000.00 $36.575.000.00 $18 240.000.00 524 320,000.00 $21,200,000.00 $45.500.000.00 560.800,000.00 $53 200 000 00 $3.990.00000 55.320,000.00 54655 000 00 $250 800,000 00 562.700,000.00 $36.480,000 00 591,200,000.00 $7.900,000 00 $188,100,000.00 $47.025.000.00 $27.360.000.00 568 400 000.00 $5.995.000.00 $94,050,000.00 $23.512,500.00 $13,500,000.00 $34 200,000.00 $2.992.500.00 Net Cash Flows: $169,090.09.09 $28,570,000.00 558,680,000.00 $55,605,000.00 584.600,000.00 562,635,000.00 $124,090,409.09 NPV IRR: $104.179.272.33 25.56 Persistence Project Operating Cash Flow 2015 2013 $350.000.000 563.33333 3 90.00 $ $2.500.000 2014 1413,000 000 626,000.00 1495.600.000 1,101.33333 of pars old price per par income generated from sales per year Networking Capital requirment 74.340.000 99. 120.000 Networking Capital requirment Variable costs Inventory Account receivable Account Payable NWC 2013 $133,000,000 $25.000.000 $ 50,000,000 $ 520 000 000 $55,000,000 2014 5156, 940 000 525,000,000 75.000.000 $ $30 000 000 $70,000.000 2015 5188,328,000 525.000.000 100.000.000 $40.000.000 $15,000,000 Recievable increases Payable increases $ $ 25,000,000 10,000,000 4,340,000 $ 14,120,000 Net Cash flow NPY IRR -58.000,000S 2.500,0001 52,677,10443 Should Rodriguez be more of less critical of cash flow forecasts for Persistence than of cash flow forecasts for Sneaker 2013? Why? Based on NPV and IRR of each project, which project looks better for the shareholders? Why? Sneaker Project 2012 Operating Cash Flow Year Pairs Sold Per Unit Sale Amount Sales Revenue Lost Sales Net Sales 2013 1.200.000,00 $190.00 5228,000,000.00 $35.000.000.00 5193.000.000.00 2014 1.500,000.00 $190 00 $304.000.000.00 $15.000.000.00 5289.000.000.00 2015 1,400,000.00 $190.00 5266,000,000.00 50.00 5266.000.000.00 2016 2.400,000.00 $190 00 5456.000.000.00 5000 3456.000.000.00 2017 1.800.000,00 $190.00 5342.000.000.00 50.00 $342.000.000.00 2018 900,000.00 $190.00 $171,000,000.00 50 00 5171.000.000,00 Gross Margin (40% of sales) Gross Margin Lost Gross Margin 591,200.000.00 $14.000.000,00 577,200.000.00 5121,600,000.00 5106,400,000.00 $6.000.000.00 $0.00 5115,600,000.00 5106,400.000 00 $162.400,000.00 50.00 $162.400,000 00 5136.800.000.00 $0.00 $136.000 000 00 568.400,000.00 50.00 560.400,000.00 Less: Expenses Seling. General & Admin Expenses Interest Kirani James Payment AAP Expense 37.000.000.00 $1.200.000,00 37.000.000.00 $1.200.000.00 200.000.00 STUDIO $7.000.000.00 1,200,000.00 32.000.000.00 SHOULUT 00 00 37.000,000.00 31.200,000.00 53,000,000.00 530 000.000.00 $7.000.000.00 $1.200.000,00 $2.000.000.00 525.000.000.00 57.000.000.00 51.200,000.00 $2.000.000.00 515 000 000 00 STUDIO Total Depreciation Profit Before Tax Tax (40%) Proft After Tax $7.900.000.00 $41,100.000,00 $16,440.000.00 $24.560,000.00 $13,900,000.00 $83.500,000.00 $33,400,000.00 $50,100,000.00 $10,850,000.00 $82,350,000.00 $32.940,000.00 $49.410.000.00 39,150,000.00 $139,050,000.00 $55.620,000.00 $83.430,000.00 58,650,000.00 $99,950,000.00 $39,900,000.00 $59.970,000.00 $7.200,000.00 $43.000.000.00 $17.200,000.00 $25.800,000.00 Add Back Depreciation Operating Cash Flow $7,900 000.00 $32.560 000.00 $13.900,000.00 564,000,000.00 $10,850,000.00 $60,260 000.00 9, 150,000.00 592.580,000.00 58,650.000.00 $68,620.000.00 $7.200,000.00 $33.000.000.00 Working Capital Requirements: Variable Costs (55% sales revenue) Inventory (25% of variable costs) Accounts Receivable (8% revenue) Accounts Payable (20% revenue) Increase in NWC: $125,400.000,00 $167.200,000.00 $146,300,000.00 $31,350.000.00 $41.800,000.00 $36.575.000.00 $18 240.000.00 524 320,000.00 $21,200,000.00 $45.500.000.00 560.800,000.00 $53 200 000 00 $3.990.00000 55.320,000.00 54655 000 00 $250 800,000 00 562.700,000.00 $36.480,000 00 591,200,000.00 $7.900,000 00 $188,100,000.00 $47.025.000.00 $27.360.000.00 568 400 000.00 $5.995.000.00 $94,050,000.00 $23.512,500.00 $13,500,000.00 $34 200,000.00 $2.992.500.00 Net Cash Flows: $169,090.09.09 $28,570,000.00 558,680,000.00 $55,605,000.00 584.600,000.00 562,635,000.00 $124,090,409.09 NPV IRR: $104.179.272.33 25.56 Persistence Project Operating Cash Flow 2015 2013 $350.000.000 563.33333 3 90.00 $ $2.500.000 2014 1413,000 000 626,000.00 1495.600.000 1,101.33333 of pars old price per par income generated from sales per year Networking Capital requirment 74.340.000 99. 120.000 Networking Capital requirment Variable costs Inventory Account receivable Account Payable NWC 2013 $133,000,000 $25.000.000 $ 50,000,000 $ 520 000 000 $55,000,000 2014 5156, 940 000 525,000,000 75.000.000 $ $30 000 000 $70,000.000 2015 5188,328,000 525.000.000 100.000.000 $40.000.000 $15,000,000 Recievable increases Payable increases $ $ 25,000,000 10,000,000 4,340,000 $ 14,120,000 Net Cash flow NPY IRR -58.000,000S 2.500,0001 52,677,10443