ASSIGNMENT 4.pdf - Adobe Reader File Edit View Window Help Open 1 2 D 145% Th Tools Question 1. [20 marks] A process, projected to have a total depreciable capital, CTDC, of $90 million, with no allocated costs for off-site utilities, is to be installed over a 3-yr period (1997-1999). Just prior to start-up, $40 million of working capital is required. At 90% of production capacity (projected for the third and subsequent operating years), sales revenues, S, are projected to be $150 million/yr and the total annual production cost, excluding depreciation, is projected to be $100 million/yr. Also, the plant is projected to operate at 0.5 of 90% and 0.75 of 90% of capacity during the first and second operating years. Thus, during those years, S = $75 million/yr and $113 rnillion/yr, respectively. Take straight-line depreciation at 8%/yr. Using the third operating year as a basis, compute: a) return on investment (ROI) b) b. payback period (PBP) Fill & Sign Comment ASSIGNMENT 4.pdf - Adobe Reader File Edit View Window Help Open 1 2 D 145% Th Tools Question 1. [20 marks] A process, projected to have a total depreciable capital, CTDC, of $90 million, with no allocated costs for off-site utilities, is to be installed over a 3-yr period (1997-1999). Just prior to start-up, $40 million of working capital is required. At 90% of production capacity (projected for the third and subsequent operating years), sales revenues, S, are projected to be $150 million/yr and the total annual production cost, excluding depreciation, is projected to be $100 million/yr. Also, the plant is projected to operate at 0.5 of 90% and 0.75 of 90% of capacity during the first and second operating years. Thus, during those years, S = $75 million/yr and $113 rnillion/yr, respectively. Take straight-line depreciation at 8%/yr. Using the third operating year as a basis, compute: a) return on investment (ROI) b) b. payback period (PBP) Fill & Sign Comment