Please help solve #7 and #11, using excel, show equations. Thank you!

Motorola Mobility LLC is a company that develops mobile devices. Headquartered in Chicago, Illinois, United States, the company was formed on January 4, 2011 by the split of Motorola Inc. into two separate companies; Motorola Mobility took on the company's consumer-oriented product lines, including its mobile phone business and its cable modems and set-top boxes for digital cable and satellite television services, while Motorola Solutions retained the company's enterprise-oriented product lines. Early 2012, Google decided to purchase Motorola mobility LLC for $12.56. Google had a plan to keep Motorola mobility for 5 years. Google financial analysis team made the following forecasts: Year Cash flow(in billions) Net income (in billions) 2012 1.5 2013 2.5 2 2014 4 3 2015 3 2 2016 6 (includes 3.5b selling price) 1.5 1 And that the average book value of asset is $86 and Google's required rate of return is its WACC. 7- Calculate net present value (NPV) for the above investment decision. Would you accept or reject this investment decision? Why? 8- Calculate payback period. If you know that google accepts projects with 4 years payback period. Would you accept that project? Payback period is 4.25. No, I would not accept due to the fact the payback period should be under 4 years according to google terms of projects. 9- Calculate the Motorola project internal rate of return (IRR). Would you accept or reject this project? Why? The IRR is 9.24% 10- Calculate the average accounting return (AAR). If you know that the required average accounting return is 25%. Would you accept that project? AAR is 23.75%. No, I would not accept the project. |11- Calculate profitability index of the above project. Would you accept or reject that deal? Why? 3 Motorola Mobility LLC is a company that develops mobile devices. Headquartered in Chicago, Illinois, United States, the company was formed on January 4, 2011 by the split of Motorola Inc. into two separate companies; Motorola Mobility took on the company's consumer-oriented product lines, including its mobile phone business and its cable modems and set-top boxes for digital cable and satellite television services, while Motorola Solutions retained the company's enterprise-oriented product lines. Early 2012, Google decided to purchase Motorola mobility LLC for $12.56. Google had a plan to keep Motorola mobility for 5 years. Google financial analysis team made the following forecasts: Year Cash flow(in billions) Net income (in billions) 2012 1.5 2013 2.5 2 2014 4 3 2015 3 2 2016 6 (includes 3.5b selling price) 1.5 1 And that the average book value of asset is $86 and Google's required rate of return is its WACC. 7- Calculate net present value (NPV) for the above investment decision. Would you accept or reject this investment decision? Why? 8- Calculate payback period. If you know that google accepts projects with 4 years payback period. Would you accept that project? Payback period is 4.25. No, I would not accept due to the fact the payback period should be under 4 years according to google terms of projects. 9- Calculate the Motorola project internal rate of return (IRR). Would you accept or reject this project? Why? The IRR is 9.24% 10- Calculate the average accounting return (AAR). If you know that the required average accounting return is 25%. Would you accept that project? AAR is 23.75%. No, I would not accept the project. |11- Calculate profitability index of the above project. Would you accept or reject that deal? Why? 3