Question: Following information was obtained based on a three-year R&D study conducted by an ongoing manufacturing company's marketing department costing the company Rs. 500,000/- Cost of
Following information was obtained based on a three-year R&D study conducted by an ongoing manufacturing company's marketing department costing the company Rs. 500,000/- Cost of building production facilities: Rs. 48,000,000 Capital expenditure: Rs. 4,000,000 Land purchased 2 years back not used at present: Rs. 2,000,000 Net working Capital required: Rs. 10,000,000 Project Life: 4 years Depreciation method for production facility: Straight line Salvage Value of building and land: Rs. 4,000,000. Value of land will remain the same throughout the project. 4 years sales estimation of new product (P1): 10,000 / year Price per unit: Rs. 10,000. Variable Cost: Rs 5,500 per Anum Other expenses: Rs 6,000,000 per Anum. Other Information available about the company is as follows: Income Taxes rate: 40%
Q) Find Cash flows for the investment
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