Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Calculations must be done in Excel.
Polycorp Limited Steel Division is considering a proposal to purchase a new machine to manufacture a new product for a potential three year contract. The new machine will cost $1.75 million. The machine has an estimated life of three years for accounting and taxation purposes. Installation will cost a further $115,000. The contract will not continue beyond three years and the equipment's estimated salvage value at the end of three years is $280,000. The tax rate is 27 percent and is payable in the year following the year in which profit is earned. An investment allowance of twenty percent on the outlay plus installation costs is available. The after tax cost of capital is 14.25%pa. Addition current assets of $96,000 are required immediately for working capital to support the project. Assume that this amount less $10000 is recovered in full at the end of the three-year life of the project. The new product will be charged $149,500 of allocated head office administration costs each year even though head office will not actually incur any extra costs to manage the project. This is in accordance with the firm's policy of allocating all corporate overhead costs to divisions. Extra marketing and administration cash outflows of $198,000 per year, will be incurred by the Steel Division for the project. An amount of $149,000 has been spent on a pilot study and market research for the new product. The projections provided here are based on this work. Projected sales in the first year for the new product are 40,000 units at $142 per unit per year. Unit sales are expected to increase by 5%pa for year two and three. Cash operating expenses are estimated to be 82 percent of sales (excludes marketing and administration, and head office items). Except for initial outlays, assume cash flows occur at the end of each year (unless otherwise stated). Assume diminishing value depreciation for tax purposes.
Required
(a) Construct a table showing net cash flow after tax (NCFAT).
(b) Calculate the NPV. Is the project acceptable? Why or why not?
The assignment in management is a two part assignment dealing 1.Theory of function of management. 2. Operations and Controlling.
Mountain Man Brewing, a family owned business where Chris Prangel, the son of the president joins. Due to increase in the preference for light beer drinkers, Chris Prangel wants to introduce light beer version in Mountain Man. An analysis into the la..
Mountain Man Brewing, a family owned business where Chris Prangel, the son of the president joins. An analysis into the launch of Mountain Man Light over the present Mountain Man Lager.
Analysis of the case using the Doing Ethics Technique (DET). Analysis of the ethical issue(s) from the perspective of an ICT professional, using the ACS Code of Conduct and properly relating clauses from the ACS Code of Conduct to the ethical issue.
Affiliations and partnerships are frequently used to reach a larger local audience? Which options stand to avail for the Hotel manager and what problems do these pose.
What influence (if any) can organizations exercise to encourage ‘innovation-friendly' regulations?
Present your findings as a group powerpoint with an audio file. In addition individually write up your own conclusions as to the effects of regional cultural issues on the corporate organisational culture of this multinational company as it conducts ..
This assignment shows a structure of business plan. The task is to write a business plane about a Diet Shop.
Identify the purposes of different types of organisations.
Entrepreneur Case Study for Analysis. Analyze Robin Wolaner's suitability to be an entrepreneur
This problem requires you to apply your cross-sectional analysis skills to a real cross-sectional data set with the goal of answering a specific research question.
Prepare a major handout on the key principles of instructional leadership
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd