Evaluating project for tiff-any golf club

Assignment Help Financial Management

Reference no: EM131530304

You are evaluating a project for The Tiff-any golf club. You estimate the sales price of The Tiff-any to be $400 per unit and sales volume to be 1,000 units in year 1; 1,500 units in year 2; and 1,325 units in year 3. The project has a 3-year life. Variable costs amount to $225 per unit and fixed costs are $100,000 per year. The project requires an initial investment of $165,000 in assets, which will be depreciated straight-line to zero over the 3-year project life. The actual market value of these assets at the end of year 3 is expected to be $35,000. NWC requirements at the beginning of each year will be approximately 20 percent of the projected sales during the coming year. The tax rate is 34 percent and the required return on the project is 10 percent.

What change in NWC occurs at the end of year 1?

Reference no: EM131530304

Questions Cloud

Describe the main objectives of the anba drp : Describe the main objectives of the ANBA DRP. Explain the key ways that ANBA's DRP can help mitigate risk in the organization.

Define service level and service level agreement : Define service level and service level agreement. What kinds of metrics will you measure? Which ones will keep your customer happy?

What is the value of the project including the tax shield : What is the value of the project, including the tax shield of the debt?

Characteristics of stakeholder and determine all stakeholder : Describe the key characteristics of a stakeholder and determine all the stakeholders within the PharmaCARE scenario

Evaluating project for tiff-any golf club : You are evaluating a project for The Tiff-any golf club. What change in NWC occurs at the end of year 1?

Explain the authors organizational structure for the study : Explain the authors organizational structure for the study - Write in standard American English appropriate for audience using correct grammar

Show the effect of the quota on the market for swordfish : The waters off the North Atlantic coast were once teeming with fish. But because of overfishing by the commercial fishing industry.

What is the current rate of return for investing in company : What is the expected return on the market? What is the current rate of return for investing in company Q?

Steps to staying safe and healthy : Choose three (3) topics that you think might apply to children with special needs and share them.

User Account

All Pages