Question: ( hola kola case ) 1- What are the relevant cash flows? In the capital budgeting analysis of this project how shall we treat: a)

( hola kola case )

1- What are the relevant cash flows? In the capital budgeting analysis of this project how shall we treat:

a) the consultant's market study cost?

b) the potential rental value of the unoccupied annex?

c)the interest charges?

d)working capital?

2-Should we consider the erosion of the existing product-the regular soda-in the analysis?Why or why not? if yes where?

3-By developing a cashflow statement, calculate the project's NPV,discounted payback period, and net saving per product unit.

4-What are the benefits and risks of undertaking this project?

5-Looking at all other factors should Bebida Sol undertake this project?Why?

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