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XYZ Pvt. Ltd. is planning a project with the following projected cash flows: Year Cash Flow (Rs.) 0 -3,00,000 1 60,000 2 70,000 3 80,000
XYZ Pvt. Ltd. is planning a project with the following projected cash flows:
Year | Cash Flow (Rs.) |
0 | -3,00,000 |
1 | 60,000 |
2 | 70,000 |
3 | 80,000 |
4 | 90,000 |
5 | 1,00,000 |
- Depreciation: 20% on original cost
- Tax rate: 30%
Required:
- Calculate Payback Period (PBP) and ARR.
- Determine NPV and NPV Index at a 8% cost of capital.
- Compute the IRR.
- Evaluate the profitability index.
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