Bon Temps embarked on an aggressive expansion that requires additional capital. Management decided to finance the
expansion by borrowing $240 million as secured loans and $255 million as unsecured loans and preference shares along
with halting dividend pa
Bon Temps embarked on an aggressive expansion that requires additional capital. Managem
expansion by borrowing $240 million as secured loans and $255 million as unsecured loans a
with halting dividend payments to increase retained earnings. Its expected s
Case: Cash Flow Projections
Allied Food Products is considering expanding into the fruit juice business with a new fresh
lemon juice product. Assume that you were recently hired as assistant to the director of capital
budgeting and you must evaluate the n
Q. 1
Project K costs $52,125, its expected cash inflows are $12,000 per year for 8 years and its WACC is 12%.
Calculate its payback (regular and discounted)
WACC
12%
Initial investment
52125
Regular payback
Discounted Payback
Year Cash Flows
Cumulative
Ye
Case: Cash Flow Projections
Allied Food Products is considering expanding into the fruit juice business with a new fresh
lemon juice product. Assume that you were recently hired as assistant to the director of capital
budgeting and you must evaluate the n
Q. 1
Q. 2
Project K costs $52,125, its expected cash inflows are $12,000 per year for 8 years and
its WACC is 12%. Calculate its payback (regular and discounted)
Year
Cash FlowsDiscountedCumulative
WACC
12%
1
12,000
2
12,000
payback
3
12,000
4
12,000
5
12
Q. 1
Q. 2
Project K costs $52,125, its expected cash inflows are $12,000 per year for 8 years and
its WACC is 12%. Calculate its payback (regular and discounted)
Year
Cash FlowsDiscountedCumulative
WACC
12%
1
12,000 10714.29 10714.29
0.34375
2
12,000 9566
Q. 1
Q. 2
Project K costs $52,125, its expected cash inflows are $12,000 per year for 8 years and
its WACC is 12%. Calculate its payback (regular and discounted)
Year
Cash FlowsDiscountedCumulative
WACC
12%
1
12,000 10714.29 10714.29
0.34375
2
12,000 9566
1 You have Rs 100,000 in a an account, and you plan to deposit an additional 25,000 at the end of every future year until your account totals Rs 2,000,000. You expect to earn 10%
annually on the account. How many years will it take to reach your goal?
PV=