Project Roar Project Roar

year Cash Flow (CF) PV Factor PV of CF year Cash Flow PV Factor

0 -740 1.0000 (740.00) 0 -740 1.0000
1 255 0.9346 238.32 1 255 0.9346
2 255 0.8734 222.73 2 255 0.8734
3 255 0.8163 208.16 3 255 0.8163
4 255 0.7629 194.54 4 255 0.7629
5 255 0.7130 181.81 5 255 0.7130
IRR 21.38% PV of future cash flow
NPV 305.55 Profitability Index
Profitability Index
year Cash Flow (CF) Net CF
0 -740 -740
1 255 -485
2 255 -230
3 255 25
4 255
5 255

Pay back period= 740/255= 2.90 year

year Cash Flow (CF) PV Factor PV of CF Net PV of year in Disc. Payback

0 -740 1.0000 (740.00) (740.00) 1
1 255 0.9346 238.32 (501.68) 1
2 255 0.8734 222.73 (278.96) 1
3 255 0.8163 208.16 (70.80) 1
4 255 0.7629 194.54 0.36
5 255 0.7130 181.81
Discounted Payback Period 4.36
PV of CF Part g.
Project Roar
238.32 year Cash Flow PV Factor PV of CF
222.73 0 -740 1.0000 (740.00)
208.16 1 255 0.9346 238.32
194.54 2 255 0.8734 222.73
181.81 3 255 0.8163 208.16
1,045.55 4 255 0.7629 194.54
=1045.55/740 5 0.7130 -
1.41 IRR 14.20%
NPV 123.74
 Operating Cash flow
Years 0 1 2 3 4 5 6
Woodcuttimng machine 460
Inventory 200
Accounts Recievable 120
Accounts payable -40
Initial investment 740
operating Cash flow 200 200 200 200 200 200
Tax at 35% 70 70 70 70 70 70
Profit after tax 130 130 130 130 130 130
Add back Depreciation 13.75 13.75 13.75 13.75 13.75 13.75
Cash flow from operations 143.75 143.75 143.75 143.75 143.75 143.75
Disposal value of machine
Inventory
Accounts Recievable
Accounts payable
Cash flow from Assets -740 143.75 143.75 143.75 143.75 143.75 143.75
IRR 19.1%

300 1500
50 450
250 150
550 2100
4500 3550
5650

3550

Q15
current Quick ratio =(75000+12000)/55000
1.58

New Quick Ratio =(75000+12000-3000)/55000x100

1.53
Thus quick ratio will decrease as a result of cash purchase for a long term asset

Q18
common stock= (15500-14000)/14000
 10.71%

Net Income=(5800-4000)/4000x100
45.00%

Q17.
Average collection period= 365/9.25 39.46

Accounts Recievable=950000/9.25 102,702.70

 7 8 9 10 11 12 13

200 200 200 200 200 200 200

70 70 70 70 70 70 70
130 130 130 130 130 130 130
13.75 13.75 13.75 13.75 13.75 13.75 13.75
143.75 143.75 143.75 143.75 143.75 143.75 143.75

143.75 143.75 143.75 143.75 143.75 143.75 143.75

Part D
Year Cash flow from Assets
0 -740
1 143.75
2 143.75
3 143.75
4 143.75
5 143.75
6 143.75
7 143.75
8 143.75
9 143.75
10 143.75
11 143.75
12 143.75
13 143.75
14 143.75
15 143.75
16 503.75
IRR 18.8%

se for a long term asset

Q 16
Sales 3,500,000
Less COGS 1,200,000
Gross Profit 2,300,000
Admin exp 250,000
marketing Exp 180,000
Dep. Expe 75,000
Total Exp 505,000
Operating Income 1,795,000
Interest Expe 22,500
Profit before tax 1,772,500
Tax @ 20% 354,500
Net profit 1,418,000
Net profti margin= net profit/sales
Net profit margin= 1418000/3500000
40.51%
 14 15 16

200 200 200

70 70 70
130 130 130
13.75 13.75 13.75
143.75 143.75 143.75
240
200
120
-40
143.75 143.75 663.75
Part C
Year Cash flow from Assets
0 -740
1 143.75
2 143.75
3 143.75
4 143.75
5 143.75
6 143.75
7 143.75
8 143.75
9 143.75
10 143.75
11 143.75
12 143.75
13 143.75
14 143.75
15 143.75
16 663.75
IRR 19.1%