Fingame simulation raport

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capital_budgeting_project_ab_.xls
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Sheet1

Name
Co. 1 Go-For-Broke, Inc.
Project A Evaluation
Numerical Intries ONLY here! 0 1 2 3 4 5 6 7 8
Life 8
Cost $ (500,000)
Overhead 16,000
Initial Labor Sav./unit 1.00
Change in lbr. Sav./qtr. 0
Capacity 100,000
Tax Rate 40.00%
Cost of Capital 2.85%
Estimated Production 100,000 100,000 100,000 100,000 100,000 100,000 100,000 100,000
No Numerical Entries Below!
Spreadsheet (below here)
Initial Investment $ (500,000)
Operating Flows:
Labor Savings $ 100,000 $ 100,000 $ 100,000 $ 100,000 $ 100,000 $ 100,000 $ 100,000 $ 100,000
Overhead Savings 16,000 16,000 16,000 16,000 16,000 16,000 16,000 16,000
Depreciation -62,500 -62,500 -62,500 -62,500 -62,500 -62,500 -62,500 -62,500
Net Income Before Tax $ 53,500 $ 53,500 $ 53,500 $ 53,500 $ 53,500 $ 53,500 $ 53,500 $ 53,500
Income Tax -21,400 -21,400 -21,400 -21,400 -21,400 -21,400 -21,400 -21,400
Net Income After Tax $ 32,100 $ 32,100 $ 32,100 $ 32,100 $ 32,100 $ 32,100 $ 32,100 $ 32,100
Depreciation Reversal 62,500 62,500 62,500 62,500 62,500 62,500 62,500 62,500
Period Cash Flow $ 94,600 $ 94,600 $ 94,600 $ 94,600 $ 94,600 $ 94,600 $ 94,600 $ 94,600
PV Interest Factor 0.97229 0.94535 0.91915 0.89368 0.86892 0.84484 0.82143 0.79867
PV Cash Flow for Period $ 91,979 $ 89,430 $ 86,952 $ 84,542 $ 82,200 $ 79,922 $ 77,707 $ 75,554
PV Future Cash Flows 668,285
Net Present Value $ 168,285
Decision Accept the Project

Sheet2

Name
Co. 1 Go-For-Broke, Inc.
Project B Evaluation
Numerical Intries ONLY here! 0 1 2 3 4 5 6 7 8 9 10 11 12
Life 12
Cost $ (507,600)
Overhead (8,000)
Initial Labor Sav./unit 0.85
Change in lbr. Sav./qtr. -0.01
Capacity 120,000
Tax Rate 40.00%
Cost of Capital 2.85%
Estimated Production 100,000 100,000 102,200 107,000 107,000 107,001 107,002 107,003 107,004 107,005 107,006 107,007
No Numerical Entries Below!
Spreadsheet (below here)
Initial Investment $ (507,600)
Operating Flows:
Labor Savings $ 85,000 $ 84,000 $ 84,826 $ 87,740 $ 86,670 $ 85,601 $ 84,532 $ 83,462 $ 82,393 $ 81,324 $ 80,255 $ 79,185
Overhead Savings -8,000 -8,000 -8,000 -8,000 -8,000 -8,000 -8,000 -8,000 -8,000 -8,000 -8,000 -8,000
Depreciation -42,300 -42,300 -42,300 -42,300 -42,300 -42,300 -42,300 -42,300 -42,300 -42,300 -42,300 -42,300
Net Income Before Tax $ 34,700 $ 33,700 $ 34,526 $ 37,440 $ 36,370 $ 35,301 $ 34,232 $ 33,162 $ 32,093 $ 31,024 $ 29,955 $ 28,885
Income Tax -13,880 -13,480 -13,810 -14,976 -14,548 -14,120 -13,693 -13,265 -12,837 -12,410 -11,982 -11,554
Net Income After Tax $ 20,820 $ 20,220 $ 20,716 $ 22,464 $ 21,822 $ 21,180 $ 20,539 $ 19,897 $ 19,256 $ 18,614 $ 17,973 $ 17,331
Depreciation Reversal 42,300 42,300 42,300 42,300 42,300 42,300 42,300 42,300 42,300 42,300 42,300 42,300
Period Cash Flow $ 63,120 $ 62,520 $ 63,016 $ 64,764 $ 64,122 $ 63,480 $ 62,839 $ 62,197 $ 61,556 $ 60,914 $ 60,273 $ 59,631
PV Interest Factor 0.97229 0.94535 0.91915 0.89368 0.86892 0.84484 0.82143 0.79867 0.77654 0.75502 0.73410 0.71375
PV Cash Flow for Period $ 61,371 $ 59,103 $ 57,921 $ 57,878 $ 55,717 $ 53,631 $ 51,618 $ 49,675 $ 47,800 $ 45,991 $ 44,246 $ 42,562
PV Future Cash Flows 627,513
Net Present Value $ 119,913
Decision Accept the Project

Sheet3