7 other costs we assume true incremental costs are 10

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Other Costs: We assume true incremental costs are 10% of revenue. 8. Tax: 35% of revenue less costs. 9. Opportunity Cost of Capital: Assumed 20%. Capital Expenditure Changes in Working Capital Inventories Receivables – Payables Depreciation Tax Shield Revenues Operating Costs Other costs Tax Net Cash Flow NPV (at 20%) = $6,326 2014 2015 2016 2017 2018 -16,201 -961 -440 1,078 8,800 -5,500 -880 -847 1,250 -1,690 -528 1,725 19,360 -10,890 -1,936 -2,287 3,754 -345 -929 1,035 37,934 -26,620 -3,793 -2,632 4,650 -380 -190 621 41,727 -29,282 -4,173 -2,895 5,428 -418 -209 621 45,900 -32,210 -4,590 -3,185 5,909 2019 Capital Expenditure Changes in Working Capital Inventories Receivables – Payables Depreciation Tax Shield Revenues Operating Costs Other costs Tax Net Cash Flow 2013 -15,400 2020 2021 2022 2023 2024 -801 8,559 -459 -229 310 50,489 -35,431 -5,049 -3,503 6,128 -505 -252 -556 -278 -612 -306 6,727 -336 3,696 55,538 -38,974 -5,554 -3,854 6,399 61,092 -42,872 -6,109 -4,239 7,038 67,202 -47,159 -6,720 -4,663 7,742 73,922 -51,875 -7,392 -5,129 15,916 12,255...
View Full Document

{[ snackBarMessage ]}

Ask a homework question - tutors are online