Cash flow forecasts for Finefodder's superstore

Year 0 Year 1-12

Initial investment -5,400,000
Sales 16,000,000
Variable costs 13,000,000
Fixed costs 2,000,000
Depreciation 450,000
Pretax profit 550,000
Taxes (at 40%) 220000
Profit after tax 330,000
Cash flow from operations 780,000

Variable costs as proportion of sales 81.25%

Discount rate 8%
12-year annuity factor 7.5360780169251
Net Present Value $ 478,140.85

Scenario analysis for superstone project

Variable Range
Pessimistic Expected
Investment 6,200,000 5,400,000
Sales 14,000,000 16,000,000
Variable cost as % of Sales 83% 81.25%
Fixed cost 2,100,000 2,000,000
sts for Finefodder's superstore
Formula in Column C

16,000,000
=$C$4*$C$13
2,000,000
=-B3/12
=C4-C5-C6-C7
=C8*40%
=C8-C9
=C7+C10

=(1-(1+$C$14)^(-12))/(C14)

or superstone project
Range
Optimistic
5,000,000
18,000,000
80%
1,900,000
 Cash flow forecasts
Year 0 Year 1-12 Formula in Column C
Initial investment -5,000,000
Sales 15,300,000 16,000,000
Variable costs 12,546,000 =$C$4*$C$13
Fixed costs 2,000,000 2,000,000
Depreciation 416,667 =-B3/12
Pretax profit 337,333 =C4-C5-C6-C7
Taxes (at 40%) 134933.33 =C8*40%
Profit after tax 202,400 =C8-C9
Cash flow from operations 619,067 =C7+C10

Variable costs as proportion of sales 82.00%

Discount rate 8%
12-year annuity factor 7.536078 =(1-(1+$C$14)^(-12))/(C14)
Net Present Value -334665.3

Scenario analysis task

Assuming that the Competing store causes
(1) a 15% decline in sales and (2) variable costs to increase to 82% of sales, perform Scenario analysis.
 Cash flow forecasts for Finefodder's superstore

enario analysis.
 Sales&Variable_costs

-5000000
18000000

0.8

Page 5
 new1

15300000

0.82

Page 6
 Cash flow forecasts
Year 0 Year 1-12 Formula in Column C
Initial investment -5,400,000
Sales 16,000,000 16,000,000
Variable costs 13,000,000 =$C$4*$C$13
Fixed costs 2,000,000 2,000,000
Depreciation 450,000 =-B3/12
Pretax profit 550,000 =C4-C5-C6-C7
Taxes (at 40%) 220000 =C8*40%
Profit after tax 330,000 =C8-C9
Cash flow from operations 780,000 =C7+C10

Variable costs as proportion of sales 81.25%

Discount rate 8%
12-year annuity factor 7.536078 =(1-(1+$C$14)^(-12))/(C14)
Net Present Value 478140.85
Cash flow forecasts for Finefodder's superstore