Question: Need help solving these and also knowing steps on how to solve them please! Problem1 8 Summer Tyme, Inc. has cashaable and is considering a
Need help solving these and also knowing steps on how to solve them please!


Problem1 8 Summer Tyme, Inc. has cashaable and is considering a new three-year expansion project that requires an initial fixed asset investment of $195.5 million. The fixed assets will be depreciated straight-line to zero 10 over its three-year tax life. The fixed assets will have a market value of 595,871,755 at the end of the project. The project is estimated to generate following revenues during those three years: $84,563,662 for year one, $66,352,100 for year two, and $58,784,123 for year three. Costs are equal to 55.75% of the same year sales. The project net working capital is equal to 14.5% of the next year's revenue. The tax-rate is 2196. What are the project's net cash flows for years 0-3? What is the IRR on this project? 12 14 15 16 Use available Excel template and complete using "best practices" (use formulas no hardcoding in model). 18 $ 84,563,662 66,352,100 $ 58,784,123 $ 195,500,000 Revenue t 1 Revenue t 2 Revenue t 3 Investment Depr. years Final book value FA Sale value NWC req't You may use positive or negative numbers in this section below make sure your that your cash flow numbers are correct. in any consistent manner. Please 23 24 25 Excel formulas are consistent and $ 95,871,755 14.50% 55.75% 21.00% 29 Tax rate 32 33 Revenue 34 Expenses 35 Depreciation 36 EBIT 37 Taxes 38 Net Income (NI 39 |OCF 40 Year 0 Year 1 Year 2 Year 3 42 Change in NWC 43 Net Capital Spendin 44 CFFA 45 46 47 Project IRR
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