Intro Finance Assignment Help, Other Engineering

Intro Finance Assignment Help, Other Engineering

Assignment Help:

QUESTION 2: Wing Yin Tsui, CEO of Lian Huang & Wong Bin Dean Hwang Manufacturing Limited is considering a four year project. The project requires an initial investment of $10,000,000 to buy new equipment. The equipment will be depreciated straight line to zero over the project’s life. The company believes it can generate $5,000,000 in pretax revenues in year 1. Revenues will increase at 20% per year. Total pretax operating cost would be 40% of the pretax revenues. Net working capital will be 20% of the pretax revenue for the year. Net working capital will be fully recovered at the end of the project. Revenues and operating costs will occur at the end of the year and investment in net working capital will be made at the beginning of the year. The tax rate is 40% and the discount rate is 12%.

1) What is the NPV of the project?

2) Now compute the project’s NPV assuming the project is abandoned after one year. The equipment will be salvaged for $8,000,000. Any gain or loss due to selling the equipment for other than the book value will create taxable gain/loss.

Related Discussions:- Intro Finance Assignment Help

Damping coefficint of canatrd of aircraft, what will be the methodology to ...

what will be the methodology to calculate pitching moment damping coefficient of canrad of aircraft

Bajaj electronics company, how would you judge the potential profits of Baj...

how would you judge the potential profits of Bajaj electronics on the first year of sales to booth plastics and give your views to increase the profit?

Function, what is function independence.on software engineering

what is function independence.on software engineering

Problem, The following exchange rates are available to you. (You can buy or...

The following exchange rates are available to you. (You can buy or sell at the stated rates.) Mt. Fuji Bank ¥85.00/$ Mt. Rushmore Bank SF1.356/$ Mt. Blanc Bank ¥64.74/SF Assume t

Analysis of the energy intensity, Analysis of the energy intensity and CO 2...

Analysis of the energy intensity and CO 2 emissions of a State a . From DOE/Energy Information Agency Florida profile is given by the following numbers (2009): What is

FSE, A W12x40 beam is heated to 760°C. Answer the following questions. Wh...

A W12x40 beam is heated to 760°C. Answer the following questions. What is the W/D factor for sprayed protection? What is the W/D factor for box type protection? What is the spe

Angle rate systems , Traditionally, seekers have been simple correlation tr...

Traditionally, seekers have been simple correlation trackers and a set of gimbals that are used to measure the angle rates of the target. - Infrared seekers detect a

My personal project - seventh grader, What makes buildings earthquaqe resis...

What makes buildings earthquaqe resistant?

Computer graphics, How to read it

How to read it

NETWORKING ETHRNET, WHAT IS RTT

WHAT IS RTT

Write Your Message!

Name

Email id

Message

Verfication Code

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd