Question
Suppose that Calloway golf would like to capitalize on Phil Michelson winning the Open Championship in 2013 by releasing a new putter. The new product
Suppose that Calloway golf would like to capitalize on Phil Michelson winning the Open Championship in 2013 by releasing a new putter. The new product will require new equipment for $410,255.00 that will be depreciated using the 5-year MACRS schedule. The project will run for 2 years with the following forecasted numbers:
| Year 1 | Year 2 | |
|---|---|---|
| Putter price | $61.74 | $61.74 |
| Units sold | 19,314.00 | 11,491.00 |
| COGS | 40.00% of sales | 40.00% of sales |
| Selling and Administrative | 19.00% of sales | 19.00% of sales |
Calloway has a 13.00% cost of capital and a 36.00% tax rate. The firm expects to sell the equipment after 2 years for a NSV of $173,993.00.
What is the NPV of the project?
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Cryptocurrencies And The Energy Transition Challenges And Opportunities For A More Sustainable Economy
Authors: George Elias
1st Edition
B0C1J3FC7R, 979-8389404076
