Cells with "?" need formulas.

3 Data 4 Example E 5 Cost of equipment needed 6 Working capital needed 7 Overhaul of equipment in four years 8 Salvage value of the equipment in five years Annual revenues and costs: 10 Sales revenues 11 Cost of goods sold 12 Out-of-pocket operating costs 13 Discount rate $60,000 $100,000 $5,000 $10,000 $200,000 $125,000 $35,000 14% 14 15 Enter a formula into each of the cells marked with a ? below 16 Exhibit 13-8 17 Years Now 19 Purchase of equipment 20 Investment in working capital 21 Sales 22 Cost of goods sold 23 Out-of-pocket operating costs 24 Overhaul of equipment 25 Salvage value of the equipment 26 Working capital released 27 Total cash flows (a) 28 Discount factor (14%) (b) 29 Present value of cash flows (a) x (b) 30 Net present value 31 32 *Use the formulas from Appendix 13B: 33 Present value of $1 = 1/(1+r)^n 34 Present value of an annuity of $1 = (1/0)*(1-(1/(1+r)^n)) Chapter 13 Applying Excel (A) Saved Help Save & Exit Submit Check my work Part 2 of 2 Required information The Chapter 13 Form worksheet is to be used to create your own worksheet version of Example E and Exhibit 13-8 in the text. points 2. The company is considering a project involving the purchase of new equipment. Change the data area of your worksheet to match the following: Use Exhibit 13B-1 and Exhibit 13B-2. (Use appropriate factor(s) from the tables provided.) eBook BC | 1 Chapter 13: Applying Excel Print 3 (Data Reference $ 290,000 $ 30,000 $ 25,000 $ 40,000 Example E Cost of equipment needed Working capital needed Overhaul of equipment in four years Salvage value of the equipment in five years 9 Annual revenues and costs: 10 Sales revenues 11 Cost of goods sold 12 Out-of-pocket operating costs 13 Discount rate $ 420,000 $ 265,000 $ 75,000 13% a. What is the net present value of the project? (Negative amount should be indicated by a minus sign. Round your present value factor to 3 decimals and round all other intermediate calculations to nearest whole dollar.) Net present value $ 236,090 c. The internal rate of return is between what two whole discount rates (e.g., between 10% and 11%, between 11% and 12%, between 12% and 13%, between 13% and 14%, etc.)? The internal rate of return is between % and 1% d. Reset the discount rate to 13%. Suppose the salvage value is uncertain. How large would the salvage value have to be to result in a positive net present value? Minimum salvage value required to generate a positive present value Chapter 13 Applying Excel (B) Saved Help Save & Exit Submit Check my work Required information The Chapter 13 Form worksheet is to be used to create your own worksheet version of Example E and Exhibit 13-8 in the text. points eBook 2. The company is considering a project involving the purchase of new equipment. Change the data area of your worksheet to match the following: Use Exhibit 13B-1 and Exhibit 13B-2. (Use appropriate factor(s) from the tables provided.) Print BC 1 Chapter 13: Applying Excel Reference 3 Data Example E Cost of equipment needed $ 270,000 Working capital needed $ 30,000 Overhaul of equipment in four years $ 15,000 Salvage value of the equipment in five $ 35,000 I years Annual revenues and costs: Sales revenues I $ 400.000 Cost of goods sold $ 255,000 Out-of-pocket operating costs $ 70,000 Discount rate 13 % 9 13 a. What is the net present value of the project? (Negative amount should be indicated by a minus sign. Round your present value factor to 3 decimals and round all other intermediate calculations to nearest whole dollar.) Net present value c. The internal rate of return is between what two whole discount rates (e.g., between 10% and 11%, between 11% and 12%, between 12% and 13%, between 13% and 14%, etc.)? The internal rate of return is between d. Reset the discount rate to 13%. Suppose the salvage value is uncertain. How large would the salvage value have to be to result in a positive net present value? Minimum salvage value required to generate a positive present value 3 Data 4 Example E 5 Cost of equipment needed 6 Working capital needed 7 Overhaul of equipment in four years 8 Salvage value of the equipment in five years Annual revenues and costs: 10 Sales revenues 11 Cost of goods sold 12 Out-of-pocket operating costs 13 Discount rate $60,000 $100,000 $5,000 $10,000 $200,000 $125,000 $35,000 14% 14 15 Enter a formula into each of the cells marked with a ? below 16 Exhibit 13-8 17 Years Now 19 Purchase of equipment 20 Investment in working capital 21 Sales 22 Cost of goods sold 23 Out-of-pocket operating costs 24 Overhaul of equipment 25 Salvage value of the equipment 26 Working capital released 27 Total cash flows (a) 28 Discount factor (14%) (b) 29 Present value of cash flows (a) x (b) 30 Net present value 31 32 *Use the formulas from Appendix 13B: 33 Present value of $1 = 1/(1+r)^n 34 Present value of an annuity of $1 = (1/0)*(1-(1/(1+r)^n)) Chapter 13 Applying Excel (A) Saved Help Save & Exit Submit Check my work Part 2 of 2 Required information The Chapter 13 Form worksheet is to be used to create your own worksheet version of Example E and Exhibit 13-8 in the text. points 2. The company is considering a project involving the purchase of new equipment. Change the data area of your worksheet to match the following: Use Exhibit 13B-1 and Exhibit 13B-2. (Use appropriate factor(s) from the tables provided.) eBook BC | 1 Chapter 13: Applying Excel Print 3 (Data Reference $ 290,000 $ 30,000 $ 25,000 $ 40,000 Example E Cost of equipment needed Working capital needed Overhaul of equipment in four years Salvage value of the equipment in five years 9 Annual revenues and costs: 10 Sales revenues 11 Cost of goods sold 12 Out-of-pocket operating costs 13 Discount rate $ 420,000 $ 265,000 $ 75,000 13% a. What is the net present value of the project? (Negative amount should be indicated by a minus sign. Round your present value factor to 3 decimals and round all other intermediate calculations to nearest whole dollar.) Net present value $ 236,090 c. The internal rate of return is between what two whole discount rates (e.g., between 10% and 11%, between 11% and 12%, between 12% and 13%, between 13% and 14%, etc.)? The internal rate of return is between % and 1% d. Reset the discount rate to 13%. Suppose the salvage value is uncertain. How large would the salvage value have to be to result in a positive net present value? Minimum salvage value required to generate a positive present value Chapter 13 Applying Excel (B) Saved Help Save & Exit Submit Check my work Required information The Chapter 13 Form worksheet is to be used to create your own worksheet version of Example E and Exhibit 13-8 in the text. points eBook 2. The company is considering a project involving the purchase of new equipment. Change the data area of your worksheet to match the following: Use Exhibit 13B-1 and Exhibit 13B-2. (Use appropriate factor(s) from the tables provided.) Print BC 1 Chapter 13: Applying Excel Reference 3 Data Example E Cost of equipment needed $ 270,000 Working capital needed $ 30,000 Overhaul of equipment in four years $ 15,000 Salvage value of the equipment in five $ 35,000 I years Annual revenues and costs: Sales revenues I $ 400.000 Cost of goods sold $ 255,000 Out-of-pocket operating costs $ 70,000 Discount rate 13 % 9 13 a. What is the net present value of the project? (Negative amount should be indicated by a minus sign. Round your present value factor to 3 decimals and round all other intermediate calculations to nearest whole dollar.) Net present value c. The internal rate of return is between what two whole discount rates (e.g., between 10% and 11%, between 11% and 12%, between 12% and 13%, between 13% and 14%, etc.)? The internal rate of return is between d. Reset the discount rate to 13%. Suppose the salvage value is uncertain. How large would the salvage value have to be to result in a positive net present value? Minimum salvage value required to generate a positive present value