| | | Bethesda Mining Example |
| Year | 0 | 1 | 2 | 3 | 4 | 5 | 6 |
| Revenue (Sales) - Contract | | $35,000.00 | $35,000.00 |
| Revenue (Sales) - Spot | | $16,000.00 | $19,840.00 |
| Total Revenue | | $51,000.00 | $54,840.00 |
| Less: Var. Costs | | -$21,750.00 | -$23,490.00 |
| Less: Fixed Costs | | -$4,200.00 | -$4,200.00 |
| Less: Depreciation | | -$7,002.10 | -$12,000.10 |
| EBIT | | $18,047.90 | $15,149.90 |
| Less: Income Tax @38% | | -$6,858.20 | -$5,756.96 |
| Incremental Earnings | | $11,189.70 | $9,392.94 |
| Plus: Depreciation | | $7,002.10 | $12,000.10 |
| Equipment | -$49,000.00 |
| Land | -$7,300.00 |
| Other investments |
| Less: change in NWC |
| Incremental Free cash flow |
| NWC |
| NOTE: year 5 is reclamation year; year 6 when tax credit received |
| Recall: Do not include sunk costs, but include opportunity costs |
Vico
BethesdaMining_capitalbudgeting_worksheetwithhints.xlsx
