Process Economics Homework 3, Problem 1

End of Year
1
2
3
4
5
6
Process Economics Homework 3, Problem 2
Column1
End of Year
0
1
2
3
4
5
6
7
8
9
10
11

Book Value
240000
=B3-D3
=B4-D4
=B5-D5
=B6-D6
=B7-E7

DDHYC % of book value

0.2
0.4
0.4
0.4
0.4

Desc.

Investment

WC+FCI
Startup

=-400+-60

WC Recoup

60

Depreciation Allowance (max)

=0.2*B3
=0.4*B4
=0.4*B5
=0.4*B6
=0.4*B7

Straight Line
N/A

Basis 400
Depreciation(MACRS5)

Note, all cash shown is in order of 1000

dMax
FCI - sum(dk)

0.2
0.32
0.192
0.1152
0.1152
0.0576

=F6/100*$B$3
=B8

=D15*400
=D16*400
=D17*400
=D18*400
=D19*400
=D20*400

MACRS Rate (%)

=D3/$B$3*100
=D4/$B$3*100
=D5/$B$3*100
=D6/$B$3*100
=E7/$B$3*100
=E8/B3*100

-400
=$F$14+SUM(E15:E15)
=$F$14+SUM(E15:E16)
=$F$14+SUM(E15:E17)
=$F$14+SUM(E15:E18)
=$F$14+SUM(E15:E19)
=$F$14+SUM(E15:E20)

Revenue

COM

R-COM-dk

dk (actual)

0
0
=0.5*$P$10
=0.9*$P$10
=0.9*$P$10
=0.9*$P$10
=0.9*$P$10
=0.9*$P$10
=0.9*$P$10
=0.9*$P$10
=0.9*$P$10
=0.9*$P$10

=20+G15/3*0.9
=20+G16/3*0.9
=20+G17/3*0.9
=20+G18/3*0.9
=20+G19/3*0.9
=20+G20/3*0.9
=20+G21/3*0.9
=20+G22/3*0.9
=20+G23/3*0.9
=20+G24/3*0.9

=G15-H15-E15
=G16-H16-E16
=G17-H17-E17
=G18-H18-E18
=G19-H19-E19
=G20-H20-E20
=G21-H21-E21
=G22-H22-E22
=G23-H23-E23
=G24-H24-E24

=G15-H15
=E16
=E17
=E18
=E19
=E20

Tax Rate
Tax (40%)

=I15*0.4
=I16*0.4
=I17*0.4
=I18*0.4
=I19*0.4
=I20*0.4
=I21*0.4
=I22*0.4
=I23*0.4
=I24*0.4

0.4
Cash flow

Discount Rate
Disc. Cash Flow

0.09
Cumul. Cash Flow

=C14
=G15-H15-K15
=G16-H16-K16
=G17-H17-K17
=G18-H18-K18
=G19-H19-K19
=G20-H20-K20
=G21-H21-K21
=G22-H22-K22
=G23-H23-K23
=G24-H24-K24+$C$24
NPV

=L14/(1+$N$10)^A14
=L15/(1+$N$10)^A15
=L16/(1+$N$10)^A16
=L17/(1+$N$10)^A17
=L18/(1+$N$10)^A18
=L19/(1+$N$10)^A19
=L20/(1+$N$10)^A20
=L21/(1+$N$10)^A21
=L22/(1+$N$10)^A22
=L23/(1+$N$10)^A23
=L24/(1+$N$10)^A24
=SUM(M14:M24)

=L14
=SUM($L$14:L15)
=SUM($L$14:L16)
=SUM($L$14:L17)
=SUM($L$14:L18)
=SUM($L$14:L19)
=SUM($L$14:L20)
=SUM($L$14:L21)
=SUM($L$14:L22)
=SUM($L$14:L23)
=SUM($L$14:L24)

C is disc. Cash flow that year

Plant Generation
Disc. Cumul Cash Flow

=M14
=SUM($M$14:M15)
=SUM($M$14:M16)
=SUM($M$14:M17)
=SUM($M$14:M18)
=SUM($M$14:M19)
=SUM($M$14:M20)
=SUM($M$14:M21)
=SUM($M$14:M22)
=SUM($M$14:M23)
=SUM($M$14:M24)
NPV for IRR
IRR:
DPP:
DPP = A+B/C
A is last negative value
for cum. Disc. Cash flow
B is cum. Disc. Cash flow that year
C is disc. Cash flow that year

=3*100/0.9
IRR Calculation
Interest Rate:
0.249145469724635
=L14/(1+$P$13)^A14
=L15/(1+$P$13)^A15
=L16/(1+$P$13)^A16
=L17/(1+$P$13)^A17
=L18/(1+$P$13)^A18
=L19/(1+$P$13)^A19
=L20/(1+$P$13)^A20
=L21/(1+$P$13)^A21
=L22/(1+$P$13)^A22
=L23/(1+$P$13)^A23
=L24/(1+$P$13)^A24
=SUM(P14:P24)
=P13
=A18+(ABS(O18/M18))