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    財管作業

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    1) The document presents financial information for a project over 4 years, including sales, costs, profits, cash flows, and NPV using different discount rates. 2) The NPV of the project is negative (-$404,959.54) at a discount rate of 8%, and the payback period is 4 years but discounted payback period shows it will not pay back in 4 years. 3) An NPV profile graph shows how the NPV changes for a range of discount rates from 2% to 42%, with the NPV becoming more negative as the discount rate increases.

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    財管作業

    Uploaded by

    1 1
    16 views5 pages
    1) The document presents financial information for a project over 4 years, including sales, costs, profits, cash flows, and NPV using different discount rates. 2) The NPV of the project is negative (-$404,959.54) at a discount rate of 8%, and the payback period is 4 years but discounted payback period shows it will not pay back in 4 years. 3) An NPV profile graph shows how the NPV changes for a range of discount rates from 2% to 42%, with the NPV becoming more negative as the discount rate increases.

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    1) The document presents financial information for a project over 4 years, including sales, costs, profits, cash flows, and NPV using different discount rates. 2) The NPV of the project is negative (-$404,959.54) at a discount rate of 8%, and the payback period is 4 years but discounted payback period shows it will not pay back in 4 years. 3) An NPV profile graph shows how the NPV changes for a range of discount rates from 2% to 42%, with the NPV becoming more negative as the discount rate increases.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    16 views5 pages

    財管作業

    Uploaded by

    1 1
    1) The document presents financial information for a project over 4 years, including sales, costs, profits, cash flows, and NPV using different discount rates. 2) The NPV of the project is negative (-$404,959.54) at a discount rate of 8%, and the payback period is 4 years but discounted payback period shows it will not pay back in 4 years. 3) An NPV profile graph shows how the NPV changes for a range of discount rates from 2% to 42%, with the NPV becoming more negative as the discount rate increases.

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    © All Rights Reserved
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    of 5

    Year 0 Year 1

    Total sales 3,000,000


    Operating cost 1,650,000
    Gross Profit 1,350,000
    Other expense 320,000
    Depreciation 1,800,000
    EBIT -770,000
    Taxes -292,600
    Net Income -477,400

    OCF 1,322,600
    change in nwc -600000
    ncs -6000000
    cffa -6600000 1,322,600
    Discounted CF 1,196,923

    PROBLEM ANS
    a.NPV -$404,959.54
    b.IRR 8%
    c. pay back period 4 years year 1
    -5,277,400

    d. discounted pay back period will not pay back in four years year 1
    -5403076.923

    e. profitability index (PI) -0.938642495 6195040.465

    f. what if the cost of capital changes, the NPV of the project will be?
    g.
    rate 0.02 0.04
    NPV $1,119,228.43 $712,872.70

    h.
    Year 2 Year 3 Year 4
    3,500,000 7,000,000 7,800,000
    1,925,000 3,850,000 4,290,000
    1,575,000 3,150,000 3,510,000
    320,000 320,000 320,000
    2,580,000 1,020,000 420,000
    -1,325,000 1,810,000 2,770,000
    -503,500 687,800 1,052,600
    -821,500 1,122,200 1,717,400
    WACC 0.105
    1+WACC 1.105
    1,758,500 2,142,200 2,137,400
    600000
    200000
    1,758,500 2,142,200 2,937,400
    1,440,183 1,587,717 1,970,217

    year 2 year 3 year 4


    -3,518,900 -1,376,700 1,560,700
    recover
    year 2 year 3 year 4
    1440183.452 -3815359.609 -1845142.988
    still not recover

    0.06 0.08 0.1 0.12 0.14


    $338,122.94 -$8,115.94 -$328,580.29 -$625,695.26 -$901,615.32
    NPV Profile
    $1,500,000.00
    $1,000,000.00
    $500,000.00
    $0.00

    0.1

    0.2

    0.3

    0.4
    -$500,000.00
    0.02
    0.04
    0.06
    0.08

    0.12
    0.14
    0.16
    0.18

    0.22
    0.24
    0.26
    0.28

    0.32
    0.34
    0.36
    0.38

    0.42
    -$1,000,000.00
    NPV

    -$1,500,000.00
    -$2,000,000.00
    -$2,500,000.00
    -$3,000,000.00
    -$3,500,000.00
    -$4,000,000.00
    DISCOUNT RATE

    0.16 0.18 0.2 0.22 0.24


    -$1,158,258.89 -$1,397,337.93 -$1,620,383.49 -$1,828,767.63 -$2,023,722.39
    0.42

    0.26 0.28 0.3 0.32 0.34


    -$2,206,356.20 -$2,377,668.19 -$2,538,560.55 -$2,689,849.39 -$2,832,274.20
    0.36 0.38 0.4 0.42
    -$2,966,506.15 -$3,093,155.38 -$3,212,777.38 -$3,325,878.71

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