please complete this lab Required minimum rate of return 7% Probable costs and m
ID: 2345093 • Letter: P
Question
please complete this lab
Required minimum rate of return 7% Probable costs and market potential: New equipment cost $ 215,000 Usable life in years 4 Salvage value $ 15,000 Working capital investment $ 60,000 Projected sales: Year Unit Sales 1 6,000 2 12,000 3 15,000 4 18, 000 Unit selling price $ 35 Variable costs per unit $ 15 Fixed sales and other costs per year* $ 105,000 *includes depreciation Advertising costs: Year Amount 1-2 $ 180,000 3 $ 150,000 4 $ 120,000 Instructions: Use the data provided on the Given tab of this workbook to complete the following Net Present Value analysis. The total lines for each section will validate by turning blue when the correct amount is calculated. As with all labs, use formulas and cell referencing wherever possible to earn full credit. Your PV factors can come from the tables in the text or you may calculate them in Excel using the formula = -PV(rate, period,, 1) Notice that you need a negative sign for the factor to appear as a positive number You can reference the rate from the top of the column and the period from the Year column. Requirement 1: Net cash inflow from sales per year Sales in units 1 2 3 4 Sales in dollars 6,000 12,000 15,000 18,000 Variable expenses Contribution margin Fixed expenses: Cash Salaries and other* Advertising Total fixed expenses Net cash inflow (outflow) *Depreciation is not a cash expense and must be eliminated: Cost of equipment Less salvage value Net depreciable cost Service life in years Per/year depreciation Hint: If the annual cash flows are different each year, you cannot use annuity PV Factors. List each year's net annual cash flow separately in the table below Item Year(s) Amount of Cash Flows 7% Factor PV of Cash Flows Net present value Would you recommend that Matheson accept the device as a new product?Explanation / Answer
too big question pls split up in multiple posts thanks
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.