Letter
Letters
>Template_ Template
Given Information , 00,000
Initial cash outlay , 00,000
Useful life 20 50,000
Operating income %
The cost of capital 9% Tax rate 40% Net cash flow Net Income Cash Flow Operating income Depreciation Net Income before taxes – 0 – 0 – 0 Tax, 40% – 0 – 0 Net Income $ – 0 net income and average book value of investment
Average net income and average book value of investment Net Income Year Net Income Avg BV of Investment – 0 8 – 0 – 0 10 – 0 – 0 11 – 0 – 0 12 – 0 – 0 13 – 0 – 0 14 – 0 – 0 15 – 0 – 0 16 – 0 – 0 17 – 0 – 0 18 – 0 – 0 19 – 0 Average – 0 ERROR:#DIV/0! a. Average rate of return on investment Put the answer in D49
b. Payback period years – using table page 126
c. Net present value – using table page 126 Amount Factor Present value $ – 0 Initial investment $ – 0 – 0 Annual net cash flow for 20 years – 0 Using MS Excel: PV of Annual net cash flow for 20 years d. Profitability Index e. Internal rate of return Period
2
1
Week
3
Given Information
Penang, Malaysia
Kuala Lumpur, Malaysia
Initial cash outlay
$
6
0
$
4
5
Useful life
20
Operating income
1,
7
1,050,000
The cost of capital
9
Tax rate
40%
Net cash flow
Net Income
Cash Flow
Operating income
Depreciation
Net Income before taxes
– 0
Tax, 40%
Net Income
$ – 0
Net cash flow $ – 0 Net cash flow $ – 0
Average
Year
Avg BV of Investment
1 $ – 0 1 – 0
2 – 0 2 – 0
3 – 0 3 – 0
4 – 0 4 – 0
5 – 0 5 – 0
6 – 0 6 – 0
7 – 0 7 – 0
8
9 – 0 9 – 0
10
11
12
13
14
15
16
17
18
19
20 – 0 20 – 0
Average $ – 0
ERROR:#DIV/0!
a.
Average rate of return on investment
Type the formula her
e.
Type the formula here. Put the answer in I49
b.
Payback period
Type the formula here. Put the answer in D53
years
Type the formula here. Put the answer in I53
c.
Net present value
Amount
Factor
Present value
Initial investment
Annual net cash flow for 20 years
Net present value $ – 0 Net present value $ – 0
Using MS Excel:
Initial investment Initial investment
PV of Annual net cash flow for 20 years
Net present value $ – 0 Net present value $ – 0
d.
Profitability Index
Type the formula here. Put the answer in D68
Type the formula here. Put the answer in I68
0.00
d.
Internal rate of return
Using MS Excel: Using MS Excel:
ERROR:#NUM!
Period
0 0
1 1
2 2
3 3
4 4
5 5
6 6
7 7
8 8
9 9
10 10
11 11
12 12
13 13
14 14
15 15
16 16
17 17
18 18
19 19
20 20