Question: I need help caluclating NPV utlizing excels fx function. Step 2 of 7 Compute NPV for Product A as shown below: Particulars Year 0 S

I need help caluclating NPV utlizing excels fx function.

I need help caluclating NPV utlizing excels fx function. Step 2 of

Step 2 of 7 Compute NPV for Product A as shown below: Particulars Year 0 S (170,000) Year 1 Year2 Year 3 Year 4 Year 5 Total Cost ofe Sales revenues Variable expenses Fixed out-of-pocket operating Annual net cash flows Present value discount factor Present value Net present value (NPV) (170.000) $250,000 $250,000 $250,000 $250,000 $250,000 (120,000) (120,000) (120,000) (120,000) (120,000) 70,000) 70,000 (70,000 (70,000(70,000 $60,000 $60,000 $60,000 $60,000 $60,000 x0.862 0.743x 51,72044.58038.460 196.440 S 26,440 33,12028.560 Compute NPV for Product B as shown below: Total $ (380,000) Particulars Year 0 S (380,000) Year 1 Year 2 Year 3Year 4Year 5 Cost of e Sales revenues Variable e S350,000 $350,000 S350,000$350,000 S350.000 (170,000) (170,000) (170,000) (170,000) (170,000) 50,000 (50.000) (50,000)(50,000(50,000 $130,000 $130,000$130,000 $130,000 $130,000 x 0.862| 0.743| 0.641| 0.552| 0.476 Ses Fixed out-of-pocket Annual net cash flows Present valuc discount factor Present value Net present value (NPV) ting costs 112,060 96,59083,33071,76061,880 425.6 45,620 Therefore, NPV of Product A is $26,440 and Product B is $45,620

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!