Solve the payback and provide the excel formula All 000's Investment: Capital Outlay Net Working Capital (10%
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
All 000's Investment: Capital Outlay Net Working Capital (10% Sales) Total Investment Investment Recovery: Equipment Salvage Net Working Capital (full recovery) Sales Revenue Cost of Goods Sold (75% Sales) SG&A (5% Sales) Operating Savings Depreciation ($18,000/6) Total Costs & Expenses EBIT - Taxes (40%) NOPAT + Depreciation - Investment = Free Cash Flow Year 0 $ $ S S $ inlin $ $ 2016 16,000 $ $ 16,000 $ 1,800 $ 75% $ 5% $ $ $ $ $ LA SALA SA $ $ $ 16,000 $ (16,000) $ 2017 2018 2,000 $ $ 400 $ 600 $ 2,400 $ 1,000 $ 2019 $ $ 2020 555 2021 $ SASA SA $ $ 4,500 $ 4,500 $ 2022 $ 1,800 $ 1,000 $10,000 4,000 $10,000 $10,000 $10,000 $10,000 3,000 $7,500 $ 7,500 $ 7,500 $ 7,500 $ 7,500 200 $ 500 $ 500 $ 500 $ 500 $ 500 2,000 $3,500 $3,500 $3,500 $3,500 $ 3,500 (3,000) $ (3,000) $ (3,000) $ (3,000) $ (3,000) $ (3,000) 4,200 $7,500 $7,500 $7,500 $ 7,500 $ 7,500 (200) $2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 (80) $1,000 $1,000 $1,000 $1,000 $1,000 (120) $ 1,500 $ 1,500 $ 1,500 $ 1,500 $ 1,500 3,000 $3,000 $3,000 $3,000 $3,000 $3,000 2,400 $1,000 $ $2,800 480 $ 3,500 $ 4,500 $ 7,300 All 000's Investment: Capital Outlay Net Working Capital (10% Sales) Total Investment Investment Recovery: Equipment Salvage Net Working Capital (full recovery) Sales Revenue Cost of Goods Sold (75% Sales) SG&A (5% Sales) Operating Savings Depreciation ($18,000/6) Total Costs & Expenses EBIT - Taxes (40%) NOPAT + Depreciation - Investment = Free Cash Flow Year 0 $ $ S S $ inlin $ $ 2016 16,000 $ $ 16,000 $ 1,800 $ 75% $ 5% $ $ $ $ $ LA SALA SA $ $ $ 16,000 $ (16,000) $ 2017 2018 2,000 $ $ 400 $ 600 $ 2,400 $ 1,000 $ 2019 $ $ 2020 555 2021 $ SASA SA $ $ 4,500 $ 4,500 $ 2022 $ 1,800 $ 1,000 $10,000 4,000 $10,000 $10,000 $10,000 $10,000 3,000 $7,500 $ 7,500 $ 7,500 $ 7,500 $ 7,500 200 $ 500 $ 500 $ 500 $ 500 $ 500 2,000 $3,500 $3,500 $3,500 $3,500 $ 3,500 (3,000) $ (3,000) $ (3,000) $ (3,000) $ (3,000) $ (3,000) 4,200 $7,500 $7,500 $7,500 $ 7,500 $ 7,500 (200) $2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 (80) $1,000 $1,000 $1,000 $1,000 $1,000 (120) $ 1,500 $ 1,500 $ 1,500 $ 1,500 $ 1,500 3,000 $3,000 $3,000 $3,000 $3,000 $3,000 2,400 $1,000 $ $2,800 480 $ 3,500 $ 4,500 $ 7,300
Expert Answer:
Answer rating: 100% (QA)
To calculate the payback period we need to determine the number of years it takes for the cumulative ... View the full answer
Related Book For
Fundamentals of Financial Management
ISBN: 978-0324597707
12th edition
Authors: Eugene F. Brigham, Joel F. Houston
Posted Date:
Students also viewed these accounting questions
-
The following additional information is available for the Dr. Ivan and Irene Incisor family from Chapters 1-6. On December 12, Irene purchased the building where her store is located. She paid...
-
List three specific parts of the Case Guide, Objectives and Strategy Section (See below) that you had the most difficulty understanding. Describe your current understanding of these parts. Provide...
-
Bottle-Up, Inc. was organized on January 8, 2010. and made its Selection on January 24, 2010. The necessary consents to the election were filed in a timely manner. Its address is 1234 Hill Street,...
-
In Rev. Rul. 81-301, which of the following is not a factor considered by the IRS in determining whether a partner receives payments in her capacity as a partner, or is instead acting as a third...
-
A beginning accounting student tried to complete a work sheet for Dick Ady's Bookkeeping Service. The following adjusting entries were to have been analyzed and entered in the work sheet: (a) Ending...
-
What do you mean by signing a JAR file multiple times? What is its usefulness?
-
Nereus Montemayor was an employee of VZ Hogs, a company that raises hogs and produces hog feed. VZ Hogs used an extruder manufactured by Sebright Products, Inc. to create hog feed out of discarded...
-
Bradburn Corporation was formed 5 years ago through a public subscription of common stock. Daniel Brown, who owns 15% of the common stock, was one of the organizers of Bradburn and is its current...
-
What do economists mean with the expression: 'the consumer considers product A and product B perfect complements'? Can you name two products that you consider perfect complements? In what proportions...
-
Bug-Off Exterminators provides pest control services and sells extermination products manufactured by other companies. The following six-column table contains the company's unadjusted trial balance...
-
An object weighing 29 kg is suspended by two wires of equal length 55 cm , How far apart must they be attached to the surface above so that the force on each is 1 5 0 N ? Solve using grade 1 2...
-
K. You step on a weighing scale, and it tells you mass 63 kilograms. How many pounds does this represents? (Note: Assume that you are on Earth. 5pts.) 3. You are driving in Europe and you see that...
-
The interior of a Boeing 737-800 can be modeled as a 32-m-long,3.7-m-diameter cylinder. The air inside, at cruising altitude, is20 o C at a pressure of 82 kPa. What volume of outside air, at -40 o C...
-
Explain how definite integral work using two simple examples and a brief explanation of why is important to our daily lives.
-
A family is on a road trip. The speed limit during the first 160 miles of the trip is 60 mph, and the speed limit during the last 245 miles is 75 mph. How many miles per hour over the speed limits...
-
Consider a single-output, non-preemptive queueing system. It has three queues connected to the single output, and packets in the queues are handled based on a strict-priority order. The three queues...
-
At the beginning of June, Rhone Company had two jobs in process, Job 44 and Job 45, with the following accumulated cost information: Job 44 Job 45 Direct materials $4,850 $1,400 Direct labor 800...
-
Suppose that fraction used = / 1.0 + 0.1Mt. for some parameter 1. Write the discrete-time dynamical system and solve for the equilibrium. Sketch a graph of the equilibrium as a function of ....
-
For purposes of measuring a firms leverage, should preferred stock be classified as debt or equity? Does it matter if the classification is being made (a) by the firms management, (b) by creditors,...
-
Assume that the risk-free rate is 6% and the expected return on the market is 13%. What is the required rate of return on a stock with a beta of 0.7?
-
In the summer of 2008, the Hadaway Company was planning to finance an expansion with a convertible security. They considered a convertible debenture but feared the burden of fixed interest charges if...
-
Verify the color SU(3) representations for combinations of three or fewer quarks and antiquarks given in Eq. (19.28). Data from Eq. 19.28 qq=303=108 qq 3 3 603, 999 3 3 3 = 36315, qqq 3 3 3 1088 10,
-
Prove that Eq. (19.34) gives the simplest multi-gluon and gluon-quark states that contain an \(\mathrm{SU}(3)\) color singlet in the decomposition. Data from Eq. 19.34 (GG)1: (88)1 (Gqq) : [8 (383)8]...
-
A textile manufacturer is concerned about the strength of cotton yarn. In order to nd out whether fiber length is an important factor in determining the strength of yarn, the quality control manager...
Study smarter with the SolutionInn App