HWA10Worksheet - MACRS Depreciation 500000 800000 480000...

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Annual output 46916.33 OPTION ONE: subcontracting t = 0 t =1 t =2 t =3 t = 4 t = 5 Incremental cgs ### ### ### ### ### tax shield 562995.98 562995.98 562995.98 562995.98 562995.98 Cash flows Payment to supplier ### ### ### ### ### Savings on tax 562995.98 562995.98 562995.98 562995.98 562995.98 Net cash flow ### ### ### ### ### discount factor, 9% 0.92 0.84 0.77 0.71 0.65 NPV of cash outflows: ### OPTION TWO: in-house making t = 0 t =1 t =2 t =3 t = 4 t = 5 Incremental cgs 675595.18 675595.18 675595.18 675595.18 675595.18
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Unformatted text preview: MACRS Depreciation 500000 800000 480000 288000 288000 Tax shield 470238.07 590238.07 462238.07 385438.07 385438.07 Cash flows Investment -2500000 Various expenditure ### ### ### ### ### Savings on tax 470238.07 590238.07 462238.07 385438.07 385438.07 Net cash flow -2500000 ### -85357.11 ### ### ### Discount factor, 9% 1 0.92 0.84 0.77 0.71 0.65 NPV of cash outflows: ### Difference t = 6 t = 6 144000 57600 57600 57600 0.6...
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HWA10Worksheet - MACRS Depreciation 500000 800000 480000...

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