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FIN3701 Assignment 1 Semester 1 2026 (224276) - DUE 30 March 2026; 100% CORRECT AND TRUSTED SOLUTIONS

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FIN3701 Assignment 1 Semester 1 2026 (224276) - DUE 30 March 2026; 100% CORRECT AND TRUSTED SOLUTIONS

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, FIN3701 Assignment 1 Semester 1 2026 (224276) - DUE 30 March 2026


QUESTION 1



1.1 Initial Investment

Calculation

Item Amount (R)
Machine 120 000
Two moulds 22 000
Working capital (plastic material) 1 200
Total Initial Investment 143 200

Consultant fee = sunk cost → Excluded

Initial Investment = R143 200



1.2 Operating Cash Inflows

(Using after-tax operating cash flow method)



Step 1: Depreciation

Salvage value = 23% × 120 000 = 27 600

Depreciable amount = 120 000 − 27 600 = 92 400

Annual depreciation = 92 400 ÷ 2 = 46 200

Connected book
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Stephen Foerster Financial Management
Publisher: 2014 ISBN: 9780133457407 Edition: Unknown

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