# 18 1188 3397 4826 10800 3600 1680 9612 6997 6506

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Unformatted text preview: 18 \$-11.88 \$33.97 \$48.26 \$108.00 36.00 \$16.80 \$96.12 \$69.97 \$65.06 <----<----<----<----<----<----<----<----<----<----<----- Equal number of sales Equal price Product 60% of TR Respective depr. Rate * \$240 (CAPEX) SUM TR - TC EBIT*Tax rate EBIT - T Depreciation SUM \$82.08 \$25.00 \$10.00 \$15.00 \$20.00 \$100.06 <----<----<----<----<----- Straight from the book Salvage value * Tax rate Difference Add back ∆NOWC Formula implementation <----<----<----<----- \$96.12 Formula Formula Formula Formula \$69.97 Tax rate WACC 40% 10% 0 Depr. Rate 1 2 33% 3 45% 4 15% 7% Adjusted WACC Year Cash flows WACC 13% 7% 13% 0 \$-260.00 NPV \$(2.226) \$34.117 1 \$82.08 2 \$96.12 3 69.97 4 100.06 Allied's Lemon Juice Project (in Thousands) End of Year I. Investment Outlays Equipment cost Installation CAPEX Increase in inventory Increase in accounts payable ∆NOWC II. Project Operating Cash Flows Unit sales (thousands) Price/unit Total revenues Operating costs excluding depreciation Depreciation Total cost EBIT (or operating income) Taxes on operating income EBIT(1-T) = After-tax operating income...
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## This homework help was uploaded on 02/16/2014 for the course BUS 330 taught by Professor Ned during the Winter '13 term at American University in Bulgaria.

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