FIN 607 Financial Management Fall 2017 Homework: Homework Chapter 8 Fundamentals of Capital Buda Sort & Save 'me Score: 0 of 1 pt 80f 10 (8 complete) HW Score: 54.17%, 5.42 of 10 pts P8-11 (similar to) Question Help * You are evaluating the HomeNet project under the following assumptions: Sales of 50,000 units in year 1 increasing by 48,000 units per year over the life of the project a year-se es p rice of S260 uri decreasing y 99 annually and a year cost of $120,unit decreasing by 18% annually. In addition, new tax laws allow you to depreciate the equipment, costing $7.5 million, over three years using straight-line depreciation. Research and development expenditures total $15 million in year O and selling, general, and administrative expenses are $2.8 million per year (assuming there is no cannibalization). Under these assumptions the unlevered net income s shown in the table: EEB. Suppose that HomeNet will have no incremental cash or inventory requirements (products will be shipped directly from the contract manufacturer to customers However, receivables related to HomeNet are expected annual cost of goods sold. a Calculate HomeNet's net working capital requirements that is, reproduce Table 84under the assumptions given to account for 15% of annual sales, and payables are expected to be 15% of the b. Calculate HomeNet's FCF (that is, reproduce Table 8.3under the same assumptions) a. Calculate HomeNet's net working capital requirements (that is, reproduce Table 8.4 under the assumptions given) The net working capital for year 1 is s (Round to the nearest thousand dollars) hor and then click Check Answer. 4 FIN 607 Financial Management Fall 2017 Homework: Homework Chapter 8 Fundamentals of Capital Buda Sort & Save 'me Score: 0 of 1 pt 80f 10 (8 complete) HW Score: 54.17%, 5.42 of 10 pts P8-11 (similar to) Question Help * You are evaluating the HomeNet project under the following assumptions: Sales of 50,000 units in year 1 increasing by 48,000 units per year over the life of the project a year-se es p rice of S260 uri decreasing y 99 annually and a year cost of $120,unit decreasing by 18% annually. In addition, new tax laws allow you to depreciate the equipment, costing $7.5 million, over three years using straight-line depreciation. Research and development expenditures total $15 million in year O and selling, general, and administrative expenses are $2.8 million per year (assuming there is no cannibalization). Under these assumptions the unlevered net income s shown in the table: EEB. Suppose that HomeNet will have no incremental cash or inventory requirements (products will be shipped directly from the contract manufacturer to customers However, receivables related to HomeNet are expected annual cost of goods sold. a Calculate HomeNet's net working capital requirements that is, reproduce Table 84under the assumptions given to account for 15% of annual sales, and payables are expected to be 15% of the b. Calculate HomeNet's FCF (that is, reproduce Table 8.3under the same assumptions) a. Calculate HomeNet's net working capital requirements (that is, reproduce Table 8.4 under the assumptions given) The net working capital for year 1 is s (Round to the nearest thousand dollars) hor and then click Check Answer. 4