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With given informations in the first picture, I want to know these 5 from the excels: #1 Upgrade #2 Cashflow #3 NPV Per Station #4

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image text in transcribed

With given informations in the first picture,

I want to know these 5 from the excels:

#1 Upgrade

#2 Cashflow

#3 NPV Per Station

#4 Payback

#5 ROI

Please show me the work in details how to get these 5 answers.

The Federal Government wants to encourage the private sector to build electric vehicle (EV) charging stations. It is investigating some policy alternatives: 1. For an average EV charging station under the current conditions, calculate the: a. NPV b. Payback c. Annualized ROI* * Divide the total profit by the initial $6,000 investment and convert to an annualized rate When discounting cash flows, the after-tax discount rate should be used (1-tax rate) X interest rate because interest is a tax-deductible expense (we did not learn that yet, but now you know!). Assume that the charging companies have other income, so a loss will reduce their total income and cause them to pay lower taxes overall. For example, at the 40% tax rate, an annual loss of $10,000 will reduce the charging companies' taxes by $4,000 (a positive inflow). As a result, the $10,000 loss will only be an after-tax loss of $6,000. Appendix I: A typical Charging Station Cost Structure. Initial cost (includes installation): $6,000 Useful Life: 6 years Residual value: \$200 Annual rent for space $1,500 Annual repairs and maintenance $500 Annual revenue: $4,400. This rate will increase 2% per year. Annual electricity cost: $1,200. This rate will increase 1% per year. A $1,000 overhaul/upgrade is expected at the end of year 3 . This cost is depreciated over the remaining 3 years. Charging companies have a pretax cost of capital of 10% due to their high risk. After 6 years the charging equipment can be sold for its residual value. The tax rate is currently 40% and straight-line depreciation can be used for tax purposes. The Federal Government wants to encourage the private sector to build electric vehicle (EV) charging stations. It is investigating some policy alternatives: 1. For an average EV charging station under the current conditions, calculate the: a. NPV b. Payback c. Annualized ROI* * Divide the total profit by the initial $6,000 investment and convert to an annualized rate When discounting cash flows, the after-tax discount rate should be used (1-tax rate) X interest rate because interest is a tax-deductible expense (we did not learn that yet, but now you know!). Assume that the charging companies have other income, so a loss will reduce their total income and cause them to pay lower taxes overall. For example, at the 40% tax rate, an annual loss of $10,000 will reduce the charging companies' taxes by $4,000 (a positive inflow). As a result, the $10,000 loss will only be an after-tax loss of $6,000. Appendix I: A typical Charging Station Cost Structure. Initial cost (includes installation): $6,000 Useful Life: 6 years Residual value: \$200 Annual rent for space $1,500 Annual repairs and maintenance $500 Annual revenue: $4,400. This rate will increase 2% per year. Annual electricity cost: $1,200. This rate will increase 1% per year. A $1,000 overhaul/upgrade is expected at the end of year 3 . This cost is depreciated over the remaining 3 years. Charging companies have a pretax cost of capital of 10% due to their high risk. After 6 years the charging equipment can be sold for its residual value. The tax rate is currently 40% and straight-line depreciation can be used for tax purposes

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