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Can You help me solve this in excel I keep Using the =NPV function But I dont know if I am using rthe right data I

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Siesta Restaurant
VALUE OF MONEY APPLICATIONS 283
Operating Results
(000)
2002
Revenue
2003
Food
$900
2004
2005
Beverage
350
$925
2006
Total
1,250
360
$950
365
$975
$1,000
Operating expenses
1,285
1,315
370
1,345
375
Food cost
240
1,375
Beverage cost
50
255
Labor cost
550
53
270
285
585
54
Travel
57
300
615
60
Marketing
120
120
650
685
60
50
120
120
Utilities
60
40
120
65
20
70
10
Rent
160
162
75
80
Total
1,240
163
1,290
165
150
1,332
1,372
1,405
Operating Profit (Loss)
$10
$ (5)
$(17)
$(27)
$(30)
Based on Paris's market analysis, tour of the competition, inspection of the subject property,
and interviews with the prior owner, she concludes a Star Restaurant would work in the subject
space, but it would require approximately $200,000 of renovation and conversion cost in addition
to the land purchase price of $2,000,000. By Year 5, the restaurant could generate $2.5 million
in annual food revenue and $1.5 million in annual beverage revenue. Ms. Brown estimates the
following cash flows for the first five years of operations, with cash flows leveling off in Year 5.
Year
Cash Flow
1
$695,000
W N
876,250
1,057,500
1,238,750
1,420,000
Calculate the IRR and NPV of this project utilizing a 12% discount rate and a 15% cap rate. Ms. Brown
1.
was able to secure a loan for $1,540,000, and an equity investor agreed to invest the remaining
$660,000 in exchange for 20% ownership in the project.

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