The Lovejoy Hotel upgrades its conference facilities approximately every five years so that it can book larger, more profitable conventions than if it had older dcor and technologies. Managers at Lovejoy are evaluating a potential conference facilities upgrade plan that would require an initial investment of $1,200,000. Managers want to analyze the upgrade plan using two scenarios, a most likely scenario and a worst-case scenario. Lovejoy has a 15% hurdle rate for this type of investment. (Click the icon to view information on the two scenarios.) Here is the basic Excel worksheet format that Lovejoy uses to analyze investments: Derformance report E (Click the icon to view the performance report.) Read the requirements - X Requirements D E B 1 Scenario #1 Scenario #2 1. In the Excel worksheet pictured above, what values or form Using the performance report snown, answer me Tollowing questions. 1. In the Excel worksheet pictured above, what values or formulas would be entered in the specified cells in the following table? Scenario #1 Scenario #2 2 Cost Cost Scenario #1 Year 1 Scenario #2 3 Year 1 Cell Value or Formula Cell Value or Formula Cell Value or Formula Cell Value or Formula 4 Year 2 Year 2 B2 E2 B2 E2 5 Year 3 Year 3 B3 E3 B3 E3 6 Year 4 Year 4 B4 E4 B4 E4 7 Year 5 Year 5 B5 E5 B5 E5 8 B6 E6 B6 E6 9 IRR after 3 years= IRR after 3 years B7 E7 B7 E7 10 IRR after 5 years= IRR after 5 years= B9 E9 B9 E9 B10 E10 B10 E10 Print Done 2. Assume that Lovejoy calculates the IRR under both scenarios. Those results are listed below. Based on this IRR analysis, should Lovejoy undertake this conference facility upgrade? Explain Scenario #1 Scenario #2 IRR after 3 years 14.4% 3.1% IRR after 5 years 26.3% 13.7% Video Eteyt nages Get more heln Clear all Check answer The Lovejoy Hotel upgrades its conference facilities approximately every five years so that it can book larger, more profitable conventions than if it had older dcor and technologies. Managers at Lovejoy are evaluating a potential conference facilities upgrade plan that would require an initial investment of $1,200,000. Managers want to analyze the upgrade plan using two scenarios, a most likely scenario and a worst-case scenario. Lovejoy has a 15% hurdle rate for this type of investment. (Click the icon to view information on the two scenarios.) Here is the basic Excel worksheet format that Lovejoy uses to analyze investments: E (Click the icon to view the performance report.) Read the requirements. - X More info 1. In the Excel worksheet pictured above, what values or formulas would be entered in the specified cells in the following table? Scenario #1 Scenario #2 Cell Value or Formula Cell Value or Formula B2 E2 Scenario #1 is the most likely scenario. If Lovejoy chooses this upgrade plan, it expects that total revenue will increase by $720,000 in Year 1, $475,000 in Year 2, $310,000 in Year 3, $295,000 in Year 4, and $125,000 in Year 5. After five years, Lovejoy expects that it will be able to sell the furniture and fixtures purchased during this facility upgrade for $75,000 and embark on another upgrade. Scenario #2 is the worst case scenario. Under the worst case scenario, Lovejoy will see total revenue increase by $612,000 in Year 1, $404,000 in Year 2, $248,000 in Year 3, $206,000 in Year 4, and $110,000 in Year 5. After five years in this worst-case scenario, Lovejoy assumes a residual value of zero for the furniture and fixtures from the upgrade B3 E3 B4 E4 B5 E5 B6 E6 B7 E7 B9 E9 Print Done B10 E10 The Lovejoy Hotel upgrades its conference facilities approximately every five years so that it can book larger, more profitable conventions than if it had older dcor and technologies. Managers at Lovejoy are evaluating a potential conference facilities upgrade plan that would require an initial investment of $1,200,000. Managers want to analyze the upgrade plan using two scenarios, a most likely scenario and a worst-case scenario. Lovejoy has a 15% hurdle rate for this type of investment. (Click the icon to view information on the two scenarios.) Here is the basic Excel worksheet format that Lovejoy uses to analyze investments: Derformance report E (Click the icon to view the performance report.) Read the requirements - X Requirements D E B 1 Scenario #1 Scenario #2 1. In the Excel worksheet pictured above, what values or form Using the performance report snown, answer me Tollowing questions. 1. In the Excel worksheet pictured above, what values or formulas would be entered in the specified cells in the following table? Scenario #1 Scenario #2 2 Cost Cost Scenario #1 Year 1 Scenario #2 3 Year 1 Cell Value or Formula Cell Value or Formula Cell Value or Formula Cell Value or Formula 4 Year 2 Year 2 B2 E2 B2 E2 5 Year 3 Year 3 B3 E3 B3 E3 6 Year 4 Year 4 B4 E4 B4 E4 7 Year 5 Year 5 B5 E5 B5 E5 8 B6 E6 B6 E6 9 IRR after 3 years= IRR after 3 years B7 E7 B7 E7 10 IRR after 5 years= IRR after 5 years= B9 E9 B9 E9 B10 E10 B10 E10 Print Done 2. Assume that Lovejoy calculates the IRR under both scenarios. Those results are listed below. Based on this IRR analysis, should Lovejoy undertake this conference facility upgrade? Explain Scenario #1 Scenario #2 IRR after 3 years 14.4% 3.1% IRR after 5 years 26.3% 13.7% Video Eteyt nages Get more heln Clear all Check answer The Lovejoy Hotel upgrades its conference facilities approximately every five years so that it can book larger, more profitable conventions than if it had older dcor and technologies. Managers at Lovejoy are evaluating a potential conference facilities upgrade plan that would require an initial investment of $1,200,000. Managers want to analyze the upgrade plan using two scenarios, a most likely scenario and a worst-case scenario. Lovejoy has a 15% hurdle rate for this type of investment. (Click the icon to view information on the two scenarios.) Here is the basic Excel worksheet format that Lovejoy uses to analyze investments: E (Click the icon to view the performance report.) Read the requirements. - X More info 1. In the Excel worksheet pictured above, what values or formulas would be entered in the specified cells in the following table? Scenario #1 Scenario #2 Cell Value or Formula Cell Value or Formula B2 E2 Scenario #1 is the most likely scenario. If Lovejoy chooses this upgrade plan, it expects that total revenue will increase by $720,000 in Year 1, $475,000 in Year 2, $310,000 in Year 3, $295,000 in Year 4, and $125,000 in Year 5. After five years, Lovejoy expects that it will be able to sell the furniture and fixtures purchased during this facility upgrade for $75,000 and embark on another upgrade. Scenario #2 is the worst case scenario. Under the worst case scenario, Lovejoy will see total revenue increase by $612,000 in Year 1, $404,000 in Year 2, $248,000 in Year 3, $206,000 in Year 4, and $110,000 in Year 5. After five years in this worst-case scenario, Lovejoy assumes a residual value of zero for the furniture and fixtures from the upgrade B3 E3 B4 E4 B5 E5 B6 E6 B7 E7 B9 E9 Print Done B10 E10