Group Project 3 - Finance 221 Capital Budgeting Excel...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Finance 221 Capital Budgeting Excel Project Compass Submission Due by 10 PM, Sunday, April 25 Please use Excel financial functions or algebraic time value of money equations to answer these questions in your spreadsheet. Please type the names of everyone in your group along with your TA’s name and discussion section at the top of the first page of your workbook. Please try to save & submit your Excel file in the 1997-2003 format. Capital Budgeting Case 1 . Wine Time, Inc. Wine Time, Inc., is a leading producer of wine in the United States. The firm was founded in 1950 by some Air Force veterans who had spent several years in France both before and after World War II. This experience convinced them that California could produce wines that were as good as or better than the best France had to offer. Originally, the company sold its wine to wholesalers for distribution under their own brand names. Then in the early 1950s, when wine sales were expanding rapidly, the firm joined with several other producers to form Wine Time, Inc., which then began an aggressive promotion campaign. Today, its wines are sold throughout the world. The table wine market has matured and Wine Time' wine cooler sales have been steadily decreasing. Consequently, to increase winery sales, management is currently considering a potential new product: a premium varietal red wine using the cabernet sauvignon grape. The new wine is designed to appeal to middle-to-upper-income professionals. The new product, Suavé Mauvé, would be positioned between the traditional table wines and super premium table wines. In market research samplings at the company’s Napa Valley headquarters, it was judged superior to various competing products. Sarah Sharpe, the financial vice president, must estimate the company's cost of capital (Part I), analyze this project, and then present her findings to the company’s executive committee (Part II). As members of Sarah's financial staff, your job is to help her prepare these findings for her report to the executive committee.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Part I: Cost of Capital Analysis Sarah Sharpe has given you the following information to help you estimate Wine Time (WT), Inc.'s weighted average cost of capital for 2010. (1) The bond quote on WT's long-term, semi-annual bond as reported in the financial
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

Page1 / 5

Group Project 3 - Finance 221 Capital Budgeting Excel...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online