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Summary Chapter 6 Exercises Solved - Corporate Finance

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Chapter 6 Exercises Solved - Corporate Finance

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Pr
project A v 100 11011 0.15412711 0.152
100
Project B NPV 120411011 0174121 1 0 754133 1 0153
179.92
b EAC EACproject NPVproject
Thirtyfactor isftp.itinitytostf.capitait
1 n
Annuityfactor
Itf2
Project A 1 1
Afr 11,44
17355

FACE 100 57.62
17355
Project B Afr 1 1 0.753 24869
o
EAC 179.92 72 35
24869
4 We should machine B bee it has the highest NPV EAC
buy



415 0 515,0
investment
DepreciationCost
1 1

, Boy 2 a lid Y produce cost
dbyp.gs
Produce
41.5alia
Sales O
units nooooo

GhetiCost Depr gjgo
85,000
EBT Sales O f 100,800 15,000

29,750
Taxes taxrate EBT 0.35 85,000

EAT EBT taxes 85,000 29,750 55,250

OOF EAT depr 55,250 15,000 70,250

Npi 58888 70,280.11 14015 30,000 30,000 4779984 gg
If
o is
mtachine additional 1 7570 yes it's
dannuity

goodidea
torkingcapitar a
Yasinge
thecorrecttime


cost
investmentCAPEX
ftp.zmity120,000year

salvagevalue yellingyear
NWCyear0



cost



Intoggarunits y 2 3 4
4,200 4,410 4,630 S 4,862.025
Sales 90 I 3780 3969 4,167.45 41375.8225
ManufCosts
pop 104 10816 772 4864
Rentalcosts
120 720 120 120
Depreciation
200 217 23489 253 7761
E BIT 70 75.95 82.2115 88 800635
tax 35 130 14105 152.68 164 97
EAT
Oper OF 250 26705 272 68 284 97 Depr EAT
NWO
35034205,441 J 463.055 0 107 Sales
DNWO 350 70 27 22.05 463.05
CAPEX 1,200
800
salvage Valve inv lyta'igdepr
ax onprofitof 28 Residual
SalvageValue Profit selling
Reg

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