Copy of UltimateSports_frame

Copy of UltimateSports_frame - unit Raw materials per unit...

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Cost of Capital Bond Yield 0.04 Cost of Equity 0.1194 Beta 1.17 After Tax cost of debt 0.0267 Risk-free rate 0.055 Weight of debt 0.2461 Market Risk Premium 0.06 Weight of equity 0.7539 Corporate income tax rate 0.34 WACC 0.0965 Market Value of Equity 31,860,000 Market Value of Debt 10,400,000 0 1 2 3 Initial Cost 165,000 Increase in NWC (if any) 100,000 Other costs (if any) - Gain/Loss (after tax) on sale of old asset (if any) - Net Investment 265,000 Depreciation Depreciable base 0.33333 0.33333 0.33333 0.33333 Annual Depreciation charge 55,000 Units sold 1,000 1,250 1,325 Selling price per unit 400.00 Variable Costs: Labor cost per
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Unformatted text preview: unit- Raw materials per unit 225.00 Total Variable Costs 225.00 Fixed cost 100,000 100,000 100,000 75,000 118,750 131,875 Operating costs - fixed and variable (∆O) Depreciation Allowance (∆DEP) 55,000 55,000 55,000 OEBT 20,000 63,750 76,875 Tax 0.660 0.660 0.660 OEAT 13,200 42,075 50,738 Add Back depreciation 55,000 55,000 55,000 Working Capital Recovery- - - Salvage Value (after tax) 23,100 Net Cash Flow (265,000) 68,200 97,075 105,738 Cumulative Cash Flow (265,000) (196,800) (99,725) 6,013 NPV (41,874) Payback Period 2.7344 IRR Err:508 Sales (∆R)...
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