FIN 419 Week 4 Assignment Help 2 | University Of Phoenix
- University of Phoenix / FIN 419
- 01 Dec 2018
- Price: $10
- Other / Other
FIN 419 Week 4 Assignment Help 2 | University Of Phoenix
Capital
Budgeting Decision Models
Purpose of Assignment
The purpose of this assignment is to
allow the students to become familiar with and practice the measurement of Net
Present Value (NPV), payback, and Weighted Average Cost of Capital (WACC) using
Microsoft® Excel®.
Assignment
Steps
Resources: Microsoft® Excel®,
Capital Budgeting Decision Models Template
Calculate the following
problems using Microsoft® Excel®:
- Calculate
the NPV for each project and determine which project should be accepted.
|
|
Project A |
Project B |
Project C |
Project D |
|
Inital Outlay |
(105,000.000) |
(99,000.00) |
(110,000.00) |
(85,000.00) |
|
Inflow year 1 |
53,000.00 |
51,000.00 |
25,000.00 |
45,000.00 |
|
Inflow year 2 |
50,000.00 |
47,000.00 |
55,000.00 |
50,000.00 |
|
Inflow year 3 |
48,000.00 |
41,000.00 |
15,000.00 |
30,000.00 |
|
Inflow year 4 |
30,000.00 |
52,000.00 |
21,000.00 |
62,000.00 |
|
Inflow year 5 |
35,000.00 |
40,000.00 |
35,000.00 |
68,000.00 |
|
Rate |
7% |
10% |
13% |
18% |
- Your
company is considering three independent projects. Given the following
cash flow information, calculate the payback period for each. If your
company requires a three-year payback before an investment can be
accepted, which project(s) would be accepted?
|
|
Project D |
Project E |
Project F |
|
Cost |
205,000.00 |
179,000.00 |
110,000.00 |
|
Inflow year 1 |
53,000.00 |
51,000.00 |
25,000.00 |
|
Inflow year 2 |
50,000.00 |
87,000.00 |
55,000.00 |
|
Inflow year 3 |
48,000.00 |
41,000.00 |
21,000.00 |
|
Inflow year 4 |
30,000.00 |
52,000.00 |
9,000.00 |
|
Inflow year 5 |
24,000.00 |
40,000.00 |
35,000.00 |
- Using
market value and book value (separately), find the adjusted WACC, using
30% tax rate.
|
Component |
Balance Sheet Value |
Market Value |
Cost of Capital |
|
Debt |
5,000,000.00 |
6,850,000.00 |
8% |
|
Preferred Stock |
4,000,000.00 |
2,200,00.00 |
10% |
|
Common Stock |
2,000,000.00 |
5,600,000.00 |
13% |
USA 
India