Estimate Incremental cash flows Projects payback period Net present value, Internal rate of return A 1 Persistence

Estimate

 Incremental cash flows

 Project’s payback period

 Net present value, 

 Internal rate of return

 

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A 1 Persistence Assumptions 2 ($ millions) 3 4 Hiking and walking market 5 Growth of market 6 Market share 7 Variable costs as % of sales 8 SG&A expenses (% of sales) 9 Other advertising and promotion 10 Tax rate 11 Purchase of technology 12 Equipment cost 13 Inventory and Acc. Rec. 14 Acc. Payable 15 16 17 15 $ $ $ $ B 40% 50 8 25 10 C Year O D $ Year 1 Year 2 Year 3 $350.0 $ 402.5 $ 462.9 15% 38% 12% E 3 $ 15% 18% 38% 10% F 2 $ 15% 20% 38% 8% 2 12 G A 1 Persistence Assumptions 2 ($ millions) 3 4 Hiking and walking market 5 Growth of market 6 Market share 7 Variable costs as % of sales 8 SG&A expenses (% of sales) 9 Other advertising and promotion 10 Tax rate 11 Purchase of technology 12 Equipment cost 13 Inventory and Acc. Rec. 14 Acc. Payable 15 16 17 15 $ $ $ $ B 40% 50 8 25 10 C Year O D $ Year 1 Year 2 Year 3 $350.0 $ 402.5 $ 462.9 15% 38% 12% E 3 $ 15% 18% 38% 10% F 2 $ 15% 20% 38% 8% 2 12 G