Q1)
Depreciation 1720
Tax Rate 21% Discount Rate 14%
Investment 8600
Sales Revenue 6545
Operating Cost 2365
Depreciation 1720
EBIT 2460
Tax 516.6
PAT 1943.4
Add Depreciation 1720
Net Income 3663.4
PV of Cash Inflows for 5 years 12576.74882
NPV 3976.75
Q2
Year 0 1 2 3
Revenue 14900 16300 17800
Cost 3200 3400 4500
Depreciation 8100 8100 8100
EBT 3600 4800 5200
Tax 792 1056 1144
PAT 2808 3744 4056
Add Depreciation 8100 8100 8100
Cash Flow from Operations 10908 11844 12156
Investment -32400
Change in NWC -350 -220 -250 -150
Cash flow from Investment -32750 -220 -250 -150
Total Cash Flow of Project -32750 10688 11594 12006
NPV @12% 1584.57
Q3
Depreciation 726666.6667 Return 12%
Tax Rate 21%
Year 0 1 2 3
Initial investment -2180000
Sales Revenue 1645000 1645000 1645000
Costs 610000 610000 610000
Depreciation 726666.7 726666.66667 726666.7
EBT 308333.3 308333.33333 308333.3
Tax 64750 64750 64750
PAT 243583.3 243583.33333 243583.3
Add Depreciation 726666.7 726666.66667 726666.7
Net Cash flow from Operations 970250 970250 970250
Net PV of Cash inflows 2330376.788
NPV of the project 150376.788
Q4)
Depreciation 726666.6667 Return 12%
Tax Rate 21%
Year 0 1 2 3
Initial investment -2430000
Sales Revenue 1645000 1645000 1645000
Costs 610000 610000 610000
Depreciation 726666.7 726666.66667 726666.7
EBT 308333.3 308333.33333 308333.3
Tax 64750 64750 64750
PAT 243583.3 243583.33333 243583.3
Add Depreciation 726666.7 726666.66667 726666.7
Net Cash flow from Operations 970250 970250 1112450
Net PV of Cash inflows 2431591.939
NPV of the project 1591.939231
Q6)
Q7)
Depreciation 107000
After-tax Salvage Value 22800
Year 0 1 2 3
Cash Outflow -475000 -60000
Cash Inflow 151080 151080 151080
Net Cash Flow -475000 151080 151080 91080
IRR 12.51%
22)
Real net cash flows 295000
g -3.50%
R 4%
PV of cash 3933333.333
23)
After Tax Salvage Value 15015
Depreciation 45000
Now
OCF= (Revenue-Cost)*(1-T)+T*Depreciation
OCF -1739
PV of Cost -128489.4042
EAC -53496.43243
24)
Depreciation 85000
After Tax Salvage Value 27300
Year 0 1 2 3
Investment -425000
Revenue 0 0 0
Cost -95000 -95000 -95000
Depreciation 85000 85000 85000
EBT 10000 10000 10000
Tax 2200 2200 2200
PAT 7800 7800 7800
Add Depreciation 85000 85000 85000
Cash Inflowfrom Operations 92800 92800 92800
Change Net Working Capital 40000 -40000
Salvage Value 27300
Net Cash Flow -385000 92800 92800 80100
NPV -42101.22156
4
13700
3100
8100
2500
550
1950
8100
10050
970
970
11020
(This will include the after-tax cost earned due to sale of that asset)
Method 2:
Depreciation 107000
Salvage Value 22800
Year 0 1
4 5 Investment -535000
Changes in NWC 60000
151080 113880
151080 113880 Cash Inflow 151080
OCF -475000 151080
IRR 16.18%
4 5
0 0
-95000 -95000
85000 85000
10000 10000
2200 2200
7800 7800
85000 85000
92800 92800
-40000
27300
92800 80100
2 3 4 5
-60000 Rev-Cost 165000
Depr 107000
151080 151080 151080 173880 EBT 58000
PAT 44080
151080 151080 151080 113880 OCF 151080
