Inputs and Key Results for Each Scenario Dollars in Thousands Base Worst Best

Inputs and key results for each scenario dollars in

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Inputs and Key Results for Each Scenario (Dollars in Thousands) Base Worst Best Scenarios: Scenario Name Base Worst Best Probability of Scenario 50% 25% 25% Intermediate Calculations 0 1 2 3 4 Intermediate Calculations 0 1 2 3 4 Intermediate Calculations 0 1 2 3 4 Inputs: Unit sales 10,000 11,500 13,225 15,209 Unit sales 8,500 8,925 9,371 9,840 Unit sales 11,500 14,375 17,969 22,461 Equipment cost 7750 8250 7250 Sales price per unit $1.50 $1.56 $1.62 $1.69 Sales price per unit $1.25 $1.30 $1.35 $1.41 Sales price per unit $1.75 $1.82 $1.89 $1.97 Salvage value, equipment, Year 4 639 639 639 Variable cost per unit (excl. depr.) $1.07 $1.10 $1.14 $1.17 Variable cost per unit (excl. depr.) $1.17 $1.21 $1.24 $1.28 Variable cost per unit (excl. depr.) $0.97 $1.00 $1.03 $1.06 Opportunity cost 0 0 0 Nonvariable costs (excl. depr.) 2120 2183.6 2249.108 $2,317 Nonvariable costs (excl. depr.) 2330 2399.9 2471.897 $2,546 Nonvariable costs (excl. depr.) 1910 1967.3 2026.319 $2,087 Externalities (cannibalization) 0 0 0 Sales revenues = Units × Price/unit 15000 17940 21456.24 $25,662 Sales revenues = Units × Price/unit 10625 11602.5 12669.93 $13,836 Sales revenues = Units × Price/unit 20125 26162.5 34011.25 $44,215 Units sold, Year 1 10,000 8,500 11,500 2250 2691 3218.436 ### $0 1593.75 1740.375 1900.4895 2075.334534 $0 3018.75 3924.375 5101.6875 6632.19375 $0 Annual change in units sold, after Year 1 15% 5% 25% Basis for depreciation 7750 Basis for depreciation 8250 Basis for depreciation 7250 Sales price per unit, Year 1 $1.50 $1.25 $1.75 Annual depreciation rate (MACRS) 33.33% 44.45% 14.81% 7.41% Annual depreciation rate (MACRS) 33.33% 44.45% 14.81% 7.41% Annual depreciation rate (MACRS) 33.33% 44.45% 14.81% 7.41% Annual change in sales price, after Year 1 4% 4% 4% Annual depreciation expense 2583.075 3444.875 1147.775 574.275 Annual depreciation expense 2749.725 ### 1221.825 611.325 Annual depreciation expense 2416.425 ### 1073.725 537.225 Variable cost per unit (VC), Year 1 $1.07 $1.17 $0.97 Remaining undepreciated value 5166.925 1722.05 574.275 0 Remaining undepreciated value 5500.275 1833.15 611.325 0 Remaining undepreciated value 4833.575 1610.95 537.225 0 Annual change in VC, after Year 1 3% 3% 3% Cash Flow Forecast Cash Flows at End of Year Cash Flow Forecast Cash Flows at End of Year Cash Flow Forecast Cash Flows at End of Year Nonvariable cost (Non-VC), Year 1 2120 2330 1910 0 1 2 3 4 0 1 2 3 4 0 1 2 3 4 Annual change in Non-VC, after Year 1 3% 3% 3% Sales revenues = Units × Price/unit $15,000 $17,940 $21,456 $25,662 Sales revenues = Units × Price/unit $10,625 $11,603 $12,670 $13,836 Sales revenues = Units × Price/unit $20,125 $26,163 $34,011 $44,215 Project WACC 10% 10% 10% Variable costs = Units × Cost/unit $10,700 $12,674 $15,013 $17,782 Variable costs = Units × Cost/unit $9,945 $10,756 $11,632 $12,580 Variable costs = Units × Cost/unit $11,155 $14,362 $18,491 $23,807 Tax rate 40% 50% 30% Nonvariable costs (excluding depreciation) $2,120 $2,184 $2,249 $2,317 Nonvariable costs (excluding depreciation) $2,330 $2,400 $2,472 $2,546 Nonvariable costs (excluding depreciation) $1,910 $1,967 $2,026 $2,087 Working capital as % of next year's sales 15% 15% 15% Depreciation $2,583 $3,445 $1,148 $574 Depreciation $2,750 $3,667 $1,222 $611 Depreciation $2,416 $3,223 $1,074 $537 Key Results: Earnings before interest and taxes (EBIT) −$403 −$363 $3,047 $4,988 Earnings before interest and taxes (EBIT) −$4,400 −$5,220 −$2,656 −$1,902 Earnings before interest and taxes (EBIT) $4,644 $6,611 $12,420 $17,783 NPV $1,048 −$7,543 $19,468 Taxes on operating profit (40% rate) −$161 −$145 $1,219 $1,995 Taxes on operating profit (40% rate) ### −$2,610 −$1,328 −$951 Taxes on operating profit (40% rate) ### $1,983 $3,726 $5,335 IRR 13.79% ### 62.41% Net operating profit after taxes −$242 −$218 $1,828 $2,993 Net operating profit after taxes −$2,200 −$2,610 −$1,328 −$951 Net operating profit after taxes $3,251 $4,627 $8,694 $12,448 MIRR 12.78% −22.23% 43.49% Add back depreciation $2,583 $3,445 $1,148 $574 Add back depreciation $2,750 $3,667 $1,222 $611 Add back depreciation $2,416 $3,223 $1,074 $537 Profitability index 1.10 0.23 2.90 Equipment purchases −$7,750 Equipment purchases −$8,250 Equipment purchases
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