Cunprer 10 9. @ « Colation of true NPV: Tuitiod cagrPow » Co= $9,000 Cam nf low Pore yoona,Cy = #000 Cash inf loa fon yoan 2, CQ =4 6000 Casninfoo Por Yyors.Ca2 44.000 Cashof enpital = oz Ovorstajenant OF COC =8% ovo C\~'08) . ¢ Eo Npve ($9000) + 6000 Ghee + Ee 08 4 4oee Cie) C099 = (9006) + 9 B-018'B49.9301 C54 5 2264-84 = GQ584: OF @ Computation of NPY at 187. discon rade, for an F. Seto _ eo $1000 44000 + + = Capone) + hag FO * Hey = (39000) + $B0B4:F5+ 93520924 $244 BQ = & QN019 Scanned with CamScannerfor project br, NPVq. Cone) + 1800 = ($9000) an = €42000) + $)0000 = $000 © Cimeumstonces. woroanting +e cormest NPV al 18%, discount rade’, Tha 12% discount Teale would give an. approxtmed-ion Join comect NPV> Sore tre project oid all inflows indie Sit yeore The praesent value of 1 40 be agived 1 yeor Prprnn0d> discounted at 187. ne Wrdb 0 BATB: Tho prosont value of BIA ChO08) Jrodis $022 tobe Tecived one geo From noo dis counted a} 10% jo! 40°8964° The foremare caleulodion overstodes the Corvzee}- apwen by appomimatelss 1.37. However Pon casnPloos Sve on Feny eons into Po Adu dts combing by 187 undenstotes tno eorwiea} present value dy approrimadels 257 and4agy | Scanned with CamScannerte Naspeatively. The erowr Iermper gubstamially deeaune the ineowiert Factor Ci.e.8) 15 comPourk) aaueing the demornadon of yo prowent volue eolaulotio tobe gwoally overstated oothot to presen value Ws groodly understated - 10+ we. know, Neve ~ ch + $ —CBton te) CMe where, tye nek Present volue = NPV Revenue 44 Loss: Vortioble cast 89:60 Lass’ Fixed cost 2 Less’ Degrtieiocion V5 pratod profit 0°80 - Lass’, Tox at 60% ae Not income 048 Add: Dopriciation | 10 oparativg exsrfiows | 95 py Srotonat 107. 6144 BEL Scanned with CamScannerTHM ove — OF + Ye HOF tom & Clary = ~)6 billion +1981 billion = -@:01% billion: Qw»!Q %® Parctieu lars Beano You = Tovestment Bo billion Revenue : BRB bik Vortiable cast 2b Fixed east 3 Depreciation 9 Preotox preofit BB Tok 235 Not profit Q45 Operadion casghfloo BBO CAtP) : No+ cash$ioro “9op)lion | FBO Mote Ore a soe ee ee ee a 90 +980% | af eae oe | - ¥ B99) Qillion- Scanned with CamScannerL D) he broak ever_point algebroicall:- Neve ~ investment? inthally + [Gxd epreciocion) «(Pi FAy, + x (Price—varciable ens) ~ fixed cost" CI-P)X CPVIFA)Dy, .)0) Setting NPV=0. 9 goin +L Co-BKD x Yood£1/ CoGHsOPTYY] +f Lex lore om- 2600005] 99 x (1-0-8¥(L1/49) ~ f Veal IO? TY) 1 = 84:0 Loerts: { 3507 / ow 4 PY ob inline s 7 | p PVo! | ae Qo” + , bilhons Prwokeven oF Yen 202 7 4 BO Joo | a iM oF ie eit of wole ‘igure Preeale- Oven point: Scanned with CamScannercrak even point is whene the present of Be eaarfioas, ineluding +e opportunidy £ gapial yes a erp NPY: were, we fourd Be breakeven sales poinr js- 24. on uit That Mees ohen there wil) be a4-om writs on drat Hme He NPV emeans +here toil be no profit l be wre the level af ansts at Which pre 244I2= [ (9% -Ve-FO-718) XOBO] $15 => V0= 3812 This will yeild NPY=0- agsuming he daxered it Conbe Ube) elsarchere irre company: 45 ; @) Coloulotieg operesting Joveroge, retng _ Poreantoge of cheng in op.ineome fe leverege porteantoge of chonge in Gales No of units = 100.000 peneetage chang? insoles = 1% Unit oodles snaywared #100 000% 47, 2 4m000 Scanned with CamScannerTheyoed gales =402 800% 325000 = OF-395 billion yen Paeviows calad= 9% biNlon Yen jnsa S4:816- BB oge change WSes. TACT Ve Pereentoge ng 2 =0°0\ Now operating PrOFit= 3-076 dil yen prieviow opersting profir- G bil yen ‘y, Chorge = 3-074 ~G°00 8:00 = 0085 j ~ _0°02% pporotng Jevarge = Sota = QB rims Pn: 0 toe kro, : DoL= 4+ ‘Fined cash +Deprectation profs BH = AP 3 225 A. Degree oF pperoding leverage = 2pHins. Scanned with CamScanner@ Number of unils are 200000 percentage Inctoase In wales omd profit <1 increased uUMt gales =200000% 1°01 = Q0Q000 Trormoped eoles = QoQ 00oxXGB¥H000 2IB7B Hilion yen Proviowe sales ane 2B billion gen perneentage change yrgales = _TBT80F5 Ie 20:0) Pereentage Chorge mop. prog Now operoting profit =)0% pillion gen previ our opercting profits 10-bB billion yen Percentage ahange jn operating profit = JOb-10-% 0% “ = o0l4 rodivg leverage - 2oM4 operorivg 9 5 Ol =) ABH mos Torefore, He pperoting leveroge is lowen if goles ate 200070 Seooterts: Scanned with CamScanner{———- (QO nprer lb 2 Dividends are payment in cash an shares oF hooky ore OINETS property raoda jo sharw- poiderts Suom Ine company’s eons decided by wo board of divwel Te givon comment fates ors: hod j4% very good Jowell the shares Jo envert tro Cash necds: T+ aloo goles Sue ohareg Ale 50\ld when Pro. rantket yo at bottom. The investors avoid Hesle 12 dng aormpany Pads regular cos dividerdls: Deelsion of not fivk of Finonaing TP an investon recieves Aividerd inskead of 12 invasting the divident Jo mvas+ j4 not Ve lode Jo yn He company’s Stock , Han the inves ores gal) APpant of Jhe Shaws th Je compory. This 15 hecawe, Mvestons ASSrimne Sot Scanned with CamScannerTe com pory jenot greswing, aa jt io not Heinvesticg its earnings: , Tn Jwis event- ppprcnity Iss, 1 dnenaby Ve shoak proce jn@noased - tho jnvastor. voll bubfer an equal bubse quent Fi @ Te viodement stotes Prot Sims of counting A poys Wighart dividends whereas Pinms of county. J page lo dividercls and enjoy )ow tos} of capital: Due to ow cast oF copitol , the cost oF 2 dividerd yeild of See Birm- Tho vtodoment isnot true becouse, sf Somns 1s dhon They have east of not possivle quirky beae med equal to He pay no dividers aopital wien is Te vietement viates thot new eaprial needs now dividends -todenvie rolule twhalnted eanwig, have zerid Cosh - "Scanned with CamScannerRefainad earmings are Purdy that 1 lef after paging Pee Gratuholdens dividends and which ly roinvested to The Companys fedume praspeds- This mdicata, that teteinedl eormigs ane noto. repracentate of free captled « Ro-rlcunel earmings anengr Cero Cask, j+ Processes ons, hot ls the game onthe Cost of equely- 20. / @ Alton Yex dividend Per shane- Dividend Pe ehore C)-tax tote) = glo (1-907) = oF | Ryan 30% dividend = oF Oven, Investomenb mad & Oy. eoch company is $00 Alor. tox tocturn = Aten Saxdividerd per-share / pubtal investment 2 $F/¢l00 =U . “1 yor toe return ON company 16 FZ Scanned with CamScannerGiven, anavo price appreciation = 10% each oe Company B Sally Shara Fon Qycans. Share pretee afjon @ Jus = cursem} dividerd price Gisi02* = 900 Cros = $2) aan on copidal gotns= 22) (1-9-2) = $)4-740- Given, Tnyageront made bf eoch corpamy Js $00. APter Jax tecturm= AfJeontox dividind pervbore] juctial investment = 8% ly100 ah TP sro investon sels Gharer able. 10 years, Hun Grane price often 0 xeats= Current dividend proce @)4)0%)7° shoo Coy? 2 hQHd9F Scanned with CamScannerTax on. copiiat garn = $15% O-'2) = $1 Bb Merefone He afjern FOX wweteurtn voi be 3.787, when Gelling Pro rare? offen tp yeans- R3, Dividend diseoun+ isa stock valustion medhed ustig He predicted djviderds and discounting 40 he present value. tock, prdce Ith. maxct y cane Cuunt siook Pricelitg) = 460% C1408) =O%4 , Lats aggume Pus comPang han n number of ont Slonding Shared The volue of re company Pon Je next year will be $64 v2 - Now dividerd Poitd, Now share will be petodnad 2armigs sy the neo josued in tho yeand. to neduce de podiay. Scanned with CamScannerDecrease inthe tyjoired comnirgs $2 CEPS-DR) = 4-2, Reerroniginal Shane + Alfarnetively tre total amount jb5 Qn. TL Py is the proce of eornmmm Stock » Fen Retained earnings = prince of otock Qn =n Volue of 4, 4~4n = CN Pi 36 BAN = 1PA+ NP > NPA = Se4an-rh => Pa = 4BR Pree of Pre NEXd Gore Por C149) => G7Q = Por LB) ABR "Po = “tsa : repo yuck grown model Pre price of the in pat Shore 64 Po = 5Ia-g Scanned with CamScannerhqualing Ihe 40 equation, we got (44 am 2) * ONG ~ AN > O4464g 2 4b 24- 5625 YA = 0-4 on 47, Now, 4D Yee hg = 662 1°04 = 40 The curocnt price 15 Unebomgel and Turaing Sho. Scanned with CamScannerQOuapteR-89 Bosie 4 @Pay out on exit ta )0 million divider) a) Cash= Dividend canbe jn JO WAYS, anh dividend Stock dividend ‘a do Sho dividerd jo a cashflow from she compay Go J+ decrease Jre Cos balance: b) wonding eaprial= coor balances ALE Leo Thus vohon Cosh Shad ig cousorenh asser decranven, The ‘yoh tooud ale p clacrevse - working capital ard) working CAP! ® poy ssoooo previow®? Supple ad cosn- As ts a Cash out flow

S100 Cob = B07. of gue daless 480 Duocl dob 2aperee= by. = $b profit= Coles —C0ms- Bod debt =100- 80-6 = 614 pro$}t undere inoremo) cose = 84 Soles decruove bg 5% Soles 495 dotas= (9gxg0%) =396 Deddeb} = Ch95% 44) = 488 prosiy 74 9S-#76~ 338 = 4h)H2 Scanned with CamScannerQh NOV =No} eollection+ wold default as 7, of Sales) Fg) AVG. CoNeehj on peru) (a4 Triarestrode) 29. Colection OS Em NOV ealoulating pen poo soles, ChossiFiaation A : yoo (1-6) NOV= BS 4 ig BaD = 41830 Clagei fi otion 2 ; lav = *02) NpV= -85> 1) OBES) = 44 A)asyi $i coc on 3 gst 100 6-19) Neve -85° pg TIS = $3.4 Chace) $j cahon 4 yoo ()- 0°2) Nove ~854% eI - = $24) Scanned with CamScanner= 29, Prosen- value of gales canbe caleulated os Chown defo * Dial cena 0.C RReaeenn nme present value oF Cs) Perege election Bey Cong dering, Soles = $100 Coby = Chl90% g0r) =§ 0 Jpierost rode = 127 a 4)00 present value of sales = CaF = §OR-395 Profj}s Sates —CoQL = BR7S-O = BRIS Considerrng bOY, Sodes ane collected roiPdin dis coun peri and 407” are normally collectal oles, £60 xU- Discount y. Psent value of & i+) Collec} ton parialjy $40 CF) ewllection panicd) gps Scanned with CamScannerCe 12) 4/abs U9 b/Sb5 = $9439 Prost} = Soles ~ COS = 393:83- $80 = $133 Gince, prosit urden Tegulen colleen o8 95 dags 5 more Shon 1-2 Bio, BOM, ned bo credit Policy. Reguiom emodi} policy of vy invredd « 2s days enowld be co eB a) Fon every Stoo in current gales, Galerie har $5 of PROSE: INU od debs. This jrnplieg Hee vst o$ goals 500 js 495-6. JS dee bad debt roo is 1¢ then per $]oo Gales +e hod deb+ wil) be $4 and echt profit wo ok an Wee G40, anet prosie mangin Scanned with CamScannerJove) op to 39-6 pere 4100 priginal goes. wast a C05} OF Jords Gold odio oF 95%, os wil) be 382 . Bad dobig will be (9:002% Bb) = $ 0:64, ©) Tore are mang TeoS0NS why he prucdicte) and actual dafawtds may lifter. For example: Pro credit Seorg Sy siem 35 bose on historical doda and does not gow Gon Charging austornett behaviot: Also» Jug estimation process ignowd dada +nom Joom appre ciott on: pre vorioble 5 Whedhen the d) Fz one of on aces unt wirr Golenia, Customers Wo? Hu crads booing bg yb Wil Ignore J ke porertiah stem y5 ikely ho be posed pe Cave postr Storm ner customers who mig rch Jenene Hepert 0 ndoms - Scanned with CamScanner