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Quarter 9 - Capital Budgeting

Quarter 9 - Capital Budgeting - Simple WACC Calculation...

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Simple WACC Calculation Explantion From Quarterly From Printout (For Debt Only) (Capital Component of Variables Printout and See** Below Rate(1-T) /Total Capital) Weight * A/T Cost Long Term Liabilities $ Amount Rate (A/T Cost) Weight% Weighted cost * Intermediate Loans: 2 years $0.00 3.11000% 2.48800% 0.00000% 0.00000000% * 3 years $0.00 2.50000% 2.00000% 0.00000% 0.00000000% *Bonds $10,802,500.00 3.21200% 2.56960% 25.34753% 0.65133008% Total Long Term Liabilities $10,802,500.00 Owners' equity **Preferred Stock $0.00 5.11000% 4.08800% 0.00000% 0.00000000% ***Common Stock $20,912,158.00 5.21200% 4.16960% 49.06934% 2.04599507% ***Retained Earnings $10,902,910.00 5.21200% 4.16960% 25.58314% 1.06671440% Total Equity $31,815,068.00 Total 100.00000% Total Capital (Total Liabilities + Total Equity) $42,617,568.00 WACC 3.76403955% Outstanding Debt Yields (historical) from Printout under Summary Data: 2-year loan 3-year loan Bonds 3.11000% 2.50000% 3.21200% Preferred Dividend Yield from the Summary Data 5.11000% ***For CS and RE an approx of the 5.21200% cost for equity is the bond rate + 2%
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Cost $453,312.00 Labor Total Overhead Q Units Savings Labor Savings Savings Total Savings Dep per Yr Increase in TI Taxes 20% NI ATCF Q9 100000 $0.56 $56,000.00 $13,078.00 $69,078.00 $56,664.00 $12,414.00 $2,482.80 $9,931.20 $66,595.20 Q10 100000 $0.57 $57,000.00 $13,078.00 $70,078.00 $56,664.00 $13,414.00 $2,682.80 $10,731.20 $67,395.20 Q11 100000 $0.58 $58,000.00 $13,078.00 $71,078.00 $56,664.00 $14,414.00 $2,882.80 $11,531.20 $68,195.20 Q12 100000 $0.59 $59,000.00 $13,078.00 $72,078.00 $56,664.00 $15,414.00 $3,082.80 $12,331.20 $68,995.20 Q13 EST 100000 $0.60 $60,000.00 $13,078.00 $73,078.00 $56,664.00 $16,414.00 $3,282.80 $13,131.20 $69,795.20 Q14 EST 100000 $0.61 $61,000.00 $13,078.00 $74,078.00 $56,664.00 $17,414.00 $3,482.80 $13,931.20 $70,595.20 Q15 EST 100000 $0.62 $62,000.00 $13,078.00 $75,078.00 $56,664.00 $18,414.00 $3,682.80 $14,731.20 $71,395.20 Q16 EST 100000 $0.63 $63,000.00 $13,078.00 $76,078.00 $56,664.00 $19,414.00 $3,882.80 $15,531.20 $72,195.20 Cost -$453,312.00 Savings q1 $66,595.20 Savings q2 $67,395.20 Savings q3 $68,195.20 Savings q4 $68,995.20 Savings q5 $69,795.20 Savings q6 $70,595.20 Savings q7 $71,395.20 Savings q8 $72,195.20
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