Lesson #5, Assignment #4 - +Dep 3,072,350 5,265,350...

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Chapter 10 Conch Republic Electronics, Part 1 Input Area: Equipment $21,500,000 Salvage value $4,100,000 $750,000 sunk cost Marketing study $200,000 sunk cost Year 1 Year 2 Year 3 Sales(units) 74,000 95,000 125,000 Depreciation rate 14.29% 24.49% 17.49% Sales of old PDA 80,000 60,000 Lost sales 15,000 15,000 Price $360 VC $155 FC $4,700,000 Price of old PDA $290 Price reduction of old PDA $35 VC of old PDA $120 Tax rate 35% NWC percentage 20% Required return 12% Output Area: Sales Year 1 Year 2 Year 3 New $26,640,000 $34,200,000 $45,000,000 Lost sales 4,350,000 4,350,000 Lost rev. 2,275,000 1,575,000 Net sales $20,015,000 $28,275,000 $45,000,000 VC New $11,470,000 $14,725,000 $19,375,000 Lost sales 1,800,000 1,800,000 $9,670,000 $12,925,000 $19,375,000
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Sales $20,015,000 $28,275,000 $45,000,000 VC 9,670,000 12,925,000 19,375,000 Fixed costs 4,700,000 4,700,000 4,700,000 Dep 3,072,350 5,265,350 3,760,350 EBT $2,572,650 $5,384,650 $17,164,650 Tax 900,428 1,884,628 6,007,628 NI $1,672,223 $3,500,023 $11,157,023
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Unformatted text preview: +Dep 3,072,350 5,265,350 3,760,350 OCF $4,744,573 $8,765,373 $14,917,373 NWC Beg $0 $4,003,000 $5,655,000 End 4,003,000 5,655,000 9,000,000 NWC CF ($4,003,000) ($1,652,000) ($3,345,000) Net CF $741,573 $7,113,373 $11,572,373 Salvage BV of equipment $4,796,650 Taxes $243,828 Salvage CF $4,343,828 Net CF Time $(21,500,000) 1 $741,573 2 $7,113,373 3 $11,572,373 4 $13,316,123 5 $20,180,810 Question 1: Payback period 3.155 Question 2: PI 1.604 Question 3:IRR 27.62% Question 4: NPV $12,983,612 Year 4 Year 5 105,000 80,000 12.49% 8.93% Year 4 Year 5 $37,800,000 $28,800,000 $37,800,000 $28,800,000 $16,275,000 $12,400,000 $16,275,000 $12,400,000 $37,800,000 $28,800,000 16,275,000 12,400,000 4,700,000 4,700,000 2,685,350 1,919,950 $14,139,650 $9,780,050 4,948,878 3,423,018 $9,190,773 $6,357,033 2,685,350 1,919,950 $11,876,123 $8,276,983 $9,000,000 $7,560,000 7,560,000 $1,440,000 $7,560,000 $13,316,123 $15,836,983...
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Lesson #5, Assignment #4 - +Dep 3,072,350 5,265,350...

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