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You are a manager at Percolated Fiber, which is consibering oxpanding as operasons in synthetic foer manulacturing Your boss comes into your office, drops a

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You are a manager at Percolated Fiber, which is consibering oxpanding as operasons in synthetic foer manulacturing Your boss comes into your office, drops a conautants report an your deek, and complains, "We owe these consultants $1.2 milion for this teport, and I am not sure their analytis makis serse. Botore wo spend the $27 milion on new equipmert needed for this project, look All of the estimates in the ceport seem correct You note that the consulants used straigh-line tepreclufon for twe new equipment that will be purchased today (vear O), which is what the accounting halcyon doys in finance class and realize there is more work to be done! accepted. Finally. you know that accounting earings are not the right thing to focus ont b. If the cost of captal for this project is 15%, what is your estinste of the value of the new propect? a. Oiven the avalable information, what are the free cash fows in years 0 thecugh to that should be used to evaluate the propoted propect? The freo cash flow for year 0 is 5 millon. (Found to three decimal places and enter a cocrease as a negative number.) The tree cash flore for years 1 to 9 is 4 milon. (Round to thee decimal places and entor a decrease as a negave numbec) You are a manager at Percolated Fiber, which is consibering oxpanding as operasons in synthetic foer manulacturing Your boss comes into your office, drops a conautants report an your deek, and complains, "We owe these consultants $1.2 milion for this teport, and I am not sure their analytis makis serse. Botore wo spend the $27 milion on new equipmert needed for this project, look All of the estimates in the ceport seem correct You note that the consulants used straigh-line tepreclufon for twe new equipment that will be purchased today (vear O), which is what the accounting halcyon doys in finance class and realize there is more work to be done! accepted. Finally. you know that accounting earings are not the right thing to focus ont b. If the cost of captal for this project is 15%, what is your estinste of the value of the new propect? a. Oiven the avalable information, what are the free cash fows in years 0 thecugh to that should be used to evaluate the propoted propect? The freo cash flow for year 0 is 5 millon. (Found to three decimal places and enter a cocrease as a negative number.) The tree cash flore for years 1 to 9 is 4 milon. (Round to thee decimal places and entor a decrease as a negave numbec)

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