CH11_mini_excel_ans

Fundamentals of Corporate Finance + Standard & Poor's Educational Version of Market Insight

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ECSY-COLA IN INGLISTAN August 19, 2002 Capital outlay (millions) $20 Discount rate 0.25 Tax rate 0.3 Fixed costs per year (millions) $3 Variable costs per liter $0.12 Revenues per liter $0.35 Steady-state sales (liters, millions) 50 Year 0 1 2 3 4 5 6, 7, etc. Investment 20.00 Tax depreciation 5.00 5.00 5.00 5.00 Depreciation tax shield 1.50 1.50 1.50 1.50 Liters sold 0.00 12.50 25.00 50.00 50.00 50.00 50.00 Revenues 0.00 4.38 8.75 17.50 17.50 17.50 17.50 - Variable costs 0.00 1.50 3.00 6.00 6.00 6.00 6.00 - Fixed costs 0.00 3.00
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Unformatted text preview: 3.00 3.00 3.00 3.00 3.00 Operating cash flow 0.00-0.13 2.75 8.50 8.50 8.50 8.50- Tax 0.00-0.04 0.83 2.55 2.55 2.55 2.55 Operating cash flow (after tax) 0.00-0.09 1.93 5.95 5.95 5.95 5.95 + Depreciation tax shield 1.50 1.50 1.50 1.50 Net cash flow-20.00 1.41 3.43 7.45 7.45 5.95 5.95 NPV =-0.1 Mini-case Solution for R. A. Brealey and S. C. Myers, Principles of Corporate Finance , 7th ed., Irwin McGraw-Hill, 2003....
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This document was uploaded on 12/04/2011.

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