Question $1$

Organize a cashflow forecast for each project beginning at time $0.$ Make sure to include the net income for each year.

Cash Receipts $\backslash$table$[[$Labor Salary,$Blank $12,$$Blank $13,$$Blank $14,],[$other$,$$Blank $15,$$Blank $16,$$Blank $17,],[$Total$,$$Blank $18,$$Blank $19,$$Blank $20,],[$Net$,$$Blank $21,$$Blank $22,$$Blank $23,],[$Project $2,$Year $0,$Year $1,$Year $2,$Year $3],[$Beginning cash$],[$Cash Receipts$],[$Savings $($revenue$),,$$Blank $24,$$Blank $25,$$Blank $26],[$Investor Proceeds$],[$Other$,$$Blank $27,,,$$Blank $28],[$Total$,$$ Blank $29,,,$$Blank $30]]$ Cash Payments

$\backslash$table$[[$Materials$,$$Blank $31,$$Blank $32,$$Blank $33,$$Blank $34],[$other$,$$Blank $35,$$Blank $36,$$Blank $37,$$Blank $38],[$Total investment,$Blank $39,,,],[$Net$,$$Blank $40,$$Blank $41,$$Blank $42,$$Blank $43]]$a$)$ How much is the initial $($net$)$ investment of the company for project $1?$

Answer: $Blank $1$

Blank $1$ A

Question $3$

b$)$ How much is the initial $($net$)$ investment of the company for project $2?$

Answer: $Blank $1$

Blank $1$NOTE: For this project you must submit documents supporting your answers in the submission section $-$ showing step$-$by$-$step how

you reached your answers. You can use excel to find the IRR only. Everything else must be shown as a calculation.

Module $4$ Assignment

You, as the project manager, have been asked to recommend which project your company should move forward with. Your

company has a total of $$350,000$ in debt at $5\%$ interest and $$400,000$ in equity at $12\%$ rate of return.

Project $1$ is to build a medium$-$sized garage for a client over three years. The client will pay $$10,000$ as a deposit immediately,

$$40,000$ the year after and $$85,000$ in the final year. Your company has a small loan of $$10,000$ with $5\%$ interest to go towards this

project that must be paid back in the end. $$50,000$ of materials will be bought all at once in the first year. As well as a piece of

equipment that requires a $$10,500$ down payment and yearly payments of $$1500$ following. Labor for the project is $$15,000$

immediately and $$6000$ per year after. Administration costs including taxes are $$4000$ for set up and $$1000$ per year after.

Project $2$ is the purchase and installation of a new piece of equipment for your company with a life span of $3$ years. The equipment

costs $$50,000$ up front and $$9,000$ to run in the following years. You have the same sources of funding $($loan and investor's equity$)$

and administration costs as project $1.$ The equipment will save your company $$25,000$ beginning the year after installation and has

a salvage value of $$12,000$ at the end of its lifespan.