Year

Cost of equipment (Rs)

Working capital (Rs)
Expected output without further processing (tons)
Expected realisation per ton without further processing (Rs)
Expected output with further processing(%)
Expected realisation per ton with further processing (Rs)
Processing cost per ton (Rs)
corporate tax rate (%)
Depreciation rate (%)
Salvage value (Rs)
Discount rate (%)
Cost of equipment
Working capital
Total initial cost
Revenue from processing
Processing cost
Depreciation
Earnings before taxes
Taxes
Earnings after tax
Cash flow after tax (CFAT)
Salvage value
Tax benefit on short term capital loss
Release of working capital
CFAT
Gross present value
NPV

0
10,000,000
1,000,000
25,000
1,000
0.8
1,600
100
0.35
0.2
1,000,000
0.15
(10,000,000)
(1,000,000)
(11,000,000)

12,869,767.58
1,869,767.58

7,000,000
2,500,000
2,000,000
2,500,000
875,000
1,625,000
3,625,000

7,000,000
2,500,000
1,600,000
2,900,000
1,015,000
1,885,000
3,485,000

7,000,000
2,500,000
1,280,000
3,220,000
1,127,000
2,093,000
3,373,000

7,000,000
2,500,000
1,024,000
3,476,000
1,216,600
2,259,400
3,283,400

3,625,000

3,485,000

3,373,000

3,283,400

7,000,000
2,500,000
4,500,000
1,575,000
2,925,000
2,925,000
1,000,000
1,083,600
1,000,000
6,008,600

Cost of new machine (Rs)

Original cost of existing machine (Rs)
Sale value of existing machine (Rs)
Age of existing machine (years)
Salvage value of new machine (Rs)
Additional working capital (Rs)
Incremental revenue per year (Rs)
Variable cost as percentage of revenue
Depreciation rate
cost of capital
corporate tax rate

1,500,000
1,000,000
200,000
4
150,000
100,000
500,000
0.3
0.2
0.1
0.35