Sale 1,000,000Less: COGS (550,000)GP 450,000Less: OEMisc exp 150,000Electric exp 70,000 (220,000)NP 230,000Per monthOperating Cost (Exp) 100,000 Old ACOperating Cost (Exp) 70,000 New AC
30,000 Benefit / Saving/ Income
Less Depreciation (3,000) 180,000 / 60Net benefit / saving 27,000Less Income Tax (40%) (10,800)Benefit after I/ Tax 16,200Add Depreciation 3,000
Cash Inflow 19,200Cash In flow = Benefit - Depreciation - Income Tax + Depreciat
IT 40% 138,00092,000
ion
100,000
Operating Cost Year Old asset New AssetBenefit Depreciation
1 625,000 600,00025,000 10,0002 630,000 590,00040,000 10,0003 635,000 595,00040,000 10,0004 645,000 605,00040,000 10,0005 655,000 620,00035,000 10,0006 660,000 630,00030,000 10,0007 662,000 637,00025,000 10,0008 670,000 650,00020,000 10,0009 676,000 661,00015,000 10,00010 680,000 670,00010,000 10,000
280,000 100,000
Year Cash Inflow Amount Pay backNeeded Balance Years
1 22,000 (100,000) (78,000) 12 22,000 (78,000) (56,000) 23 22,000 (56,000) (34,000) 34 22,000 (34,000) (12,000) 45 22,000 (12,000)6 22,000 -7 22,0008 22,000
Req # 2 Pay Back period
of 00
Capital Budgeting Examples
5,176 Reads
Info and Rating
| Category: | Uncategorized. |
| Rating: | |
| Upload Date: | 11/25/2009 |
| Copyright: | Attribution Non-commercial |
| Tags: |
Leave a Comment