INVESTING

Particulars
Opportunity Cost
Machine
Less: Accumulated Depreciation
Machine Value after Depreciation
Working Capital
Changes in Net Working Capital
CASH FLOW FROM INVEST.

0
-150.00
-100.00

10.00
-10.00
-260.00

Income
Revenue
Less: Costs
Less: Depreciation
EBIT
Tax
Net Income

Free Cash Flow

Net Income
Add: Depreciation
CASH FLOW FROM OPR.
CASH FLOW FROM INVEST.
FREE CASH FLOW
CUMULATIVE CASH FLOWS

-260.00
-260.00

Year
2

-20.00
80.00
10.00
0.00
0.00

-32.00
68.00
16.32
-6.32
-6.32

-71.20
28.80
24.97
-8.65
-8.65

-82.70
17.30
21.22
3.75
3.75

100.00
-50.00
-20.00
30.00
10.20
19.80

163.20
-88.00
-32.00
43.20
14.69
28.51

249.70
-145.20
-19.20
85.30
29.00
56.30

212.24
-133.10
-11.50
67.64
23.00
44.64

19.80
20.00
39.80
0.00
39.80
39.80

28.51
32.00
60.51
-6.32
54.19
93.99

56.30
19.20
75.50
-8.65
66.85
160.84

44.64
11.50
56.14
3.75
59.89
220.73

Depreciation rates
5
150.00
21.77
-94.20
5.80
0.00
21.22
192.99

0.2

0.32

0.192

0.115

<-- in cash flows when we added/subtracted increases/decreases in assets/liabilities; we were looking at t

129.89
-87.85
-11.50
30.55
10.39
20.16

20.16
11.50
31.66
192.99
224.65
445.38

0.115

4%
5%
6%
7%

NPV
123.64
110.10
97.22
84.96

IRR
16%

eases in assets/liabilities; we were looking at the effects on net working capital.

Year
1
2
3
4
5

Production
5000
8000
12000
10000
6000

Price
20.00
20.40
20.81
21.22
21.65

Revenue
100,000.00
163,200.00
249,696.00
212,241.60
129,891.86

Cost

10.00
11.00
12.10
13.31
14.64

Total Cost
50000
88000
145200
133100
87846

YEAR 1
Base
Pessimistic
10
11
123.64
94.31

Cost
NPV

Optimistic
9
152.98

Price
NPV

24
223.59

20
123.64

16
23.69

Production
NPV

5500
126.82

5000
123.64

4500
120.47

% change in cost
NPV

5
151.53

10
123.64

15
93.9

% growth in price
NPV

7
176.59

2
123.64

0
103.73

Optimistic

8800
128.23

YEAR 2
Base
Pessimistic

8000
123.64

^ Assumptions made are being altered to get a fix on which variable is the most critical.

7200
119.05

YEAR 3
Optimistic

13200
129.77

YEAR 3
Base
Pessimistic

12000
123.64

10800
117.51

Optimistic

11000
128.11

YEAR 4
Base
Pessimistic

10000
123.64

9000
119.18

Optimistic

6600
125.92

YEAR 5
Base
Pessimistic

6000
123.64

5400
121.36

Production
Cost
Price
Growth of Price
Growth of Costs
NPV

Scenario Optimistic
7000
9
22
4%
5%

Normal
5000
10
20
2%
10%

Scenario Pessimistic
3000
12
15
0%
10%

267.24

123.64

-78.71