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  • Machine A Cash Flows

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    Radhakrishna Indalkar
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    This document presents a financial analysis of investing in a hydraulic press machine made in Korea over 8 years. It shows the projected annual sales, revenues, profits, expenses including depreciation and interest. It calculates the net cash flow and cumulative cash flow each year under interest rates of 12% and 37% to determine the present value of the investment. The analysis finds that at a 12% interest rate the present value of the investment is $5.1 million and at a 37% interest rate the present value is $2.6 million, indicating the investment is viable at 12% but not 37%.

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    This document presents a financial analysis of investing in a hydraulic press machine made in Korea over 8 years. It shows the projected annual sales, revenues, profits, expenses including depreciation and interest. It calculates the net cash flow and cumulative cash flow each year under interest rates of 12% and 37% to determine the present value of the investment. The analysis finds that at a 12% interest rate the present value of the investment is $5.1 million and at a 37% interest rate the present value is $2.6 million, indicating the investment is viable at 12% but not 37%.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    12 views1 page

    Machine A Cash Flows

    Uploaded by

    Radhakrishna Indalkar
    This document presents a financial analysis of investing in a hydraulic press machine made in Korea over 8 years. It shows the projected annual sales, revenues, profits, expenses including depreciation and interest. It calculates the net cash flow and cumulative cash flow each year under interest rates of 12% and 37% to determine the present value of the investment. The analysis finds that at a 12% interest rate the present value of the investment is $5.1 million and at a 37% interest rate the present value is $2.6 million, indicating the investment is viable at 12% but not 37%.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    of 1

    A

    MADE IN KOREA
    Asset = Hydraulic Press Machine
    Total Investment = 26082400.00 Interest Rate = 12%

    Year Projeected Sales/Volumes Selling Price Revenue/Throughput Profit


    0.10 Increase Volume X SP Revenue - OP Expn
    1 1868340.00 10.12 18907600.80 7113988.80
    2 1868340.00 10.22 19094434.80 7150073.80
    3 1868340.00 10.32 19281268.80 7179727.80
    4 1868340.00 10.42 19468102.80 7207215.05
    5 1868340.00 10.52 19654936.80 7230256.53
    6 1868340.00 10.62 19841770.80 7248728.19
    7 1868340.00 10.72 20028604.80 7262502.55
    8 1868340.00 10.82 20215438.80 7271448.54
    57663941.27

    Year Depreciation Interest Other Operating Expenses Total Operating Epn


    8 years life 0.12 2.79% Increase
    1 3260300.00 3129888.00 5403424.00 11793612.00 150749.00
    2 3260300.00 3129888.00 5554173.00 11944361.00 2.79
    3 3260300.00 3129888.00 5711353.00 12101541.00 159346.75
    4 3260300.00 3129888.00 5870699.75 12260887.75 2.79
    5 3260300.00 3129888.00 6034492.27 12424680.27
    6 3260300.00 3129888.00 6202854.61 12593042.61
    7 3260300.00 3129888.00 6375914.25 12766102.25
    8 3260300.00 3129888.00 6553802.26 12943990.26

    X
    Year Net Cashflow Cummulative Cash Flow PV @ 12% Present Value
    Profit + Dep
    1 10374288.80 10374288.80 0.892 9253865.61
    2 10410373.80 20784662.60 0.797 8297067.92
    3 10440027.80 31224690.40 0.711 7422859.77
    4 10467515.05 41692205.45 0.635 6646872.06
    5 10490556.53 52182761.98 0.567 5948145.55
    6 10509028.19 62691790.17 0.506 5317568.27
    7 10522802.55 73214592.72 0.452 4756306.75
    8 10531748.54 83746341.27 0.403 4244294.66
    83746341.27 51886980.58

    Y
    Year Net Cashflow Cummulative Cash Flow PV @ 37% Present Value
    Profit + Dep 0.37
    1 10374288.80 10374288.80 0.731 7587704.37
    2 10410373.80 20784662.60 0.535 5568913.34
    3 10440027.80 31224690.40 0.391 4084678.31
    4 10467515.05 41692205.45 0.286 2995379.59
    5 10490556.53 52182761.98 0.209 2195628.54
    6 10509028.19 62691790.17 0.153 1608699.64
    7 10522802.55 73214592.72 0.112 1178137.28
    8 10531748.54 83746341.27 0.082 862416.44
    83746341.27 26081557.50

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