Financial Management Of Corporate Projects Case Study
CRANEFIELD COLLEGE
OF
PROJECT AND PROGRAMME MANAGEMENT Group Assignment
Module : Financial Management of Corporate Projects and Programmes (M6)
Due Date: 11 June 2015
I, the undersigned, hereby declare that this assignment is my own work. It has not been previously submitted for any other examination.
Name Identity Number Signature
Claudia Tucker 8106230199082
Vuyani Mawetu Matoti 7202166096086 TABLE OF CONTENTS
Contents
Executive Summary 2
1. Problems Identified 4
2. The financial analysis 5
3. Analysis Framework: 5
4. Critical Key Issues 7
5. Recommendations 7
6. Conclusion: 8
7. BIBLIOGRAPHY 10
Executive Summary
Jane Rogers, a marketing representative for Pressco Inc. prepared a financial …show more content…
This new tax law that would change the following
1. Will eliminate the investment tax credit for the new equipment
2. To extend depreciation lives for new equipment
3. Reduce corporate tax from 46% to 34 %
Jane Rogers took into consideration the envisaged tax law in representing the new offer to PaperCo.
This paper covers the different options that would assist PaperCo in arriving at the best investment decision.
The paper utilises the Net Present Value and the Internal Rate of Return techniques, to arrive to a most feasible and enticing investment option for …show more content…
Last year (1984) investment in new drying equipment pursuant to Option 1 was not pursued despite its attractiveness as a viable capital project, perhaps because it was possible that a better alternative might arise. However, given the impending tax legislation, the possible alternatives are now known, and they are not good. Under the new tax legislation without grandfathering, the project is not viable. Paperco should invest in the paper drying equipment because not doing so soon enough is not a viable alternative, while investing in the equipment is a viable alternative (i.e., the Net Present Value of the project is
OF
PROJECT AND PROGRAMME MANAGEMENT Group Assignment
Module : Financial Management of Corporate Projects and Programmes (M6)
Due Date: 11 June 2015
I, the undersigned, hereby declare that this assignment is my own work. It has not been previously submitted for any other examination.
Name Identity Number Signature
Claudia Tucker 8106230199082
Vuyani Mawetu Matoti 7202166096086 TABLE OF CONTENTS
Contents
Executive Summary 2
1. Problems Identified 4
2. The financial analysis 5
3. Analysis Framework: 5
4. Critical Key Issues 7
5. Recommendations 7
6. Conclusion: 8
7. BIBLIOGRAPHY 10
Executive Summary
Jane Rogers, a marketing representative for Pressco Inc. prepared a financial …show more content…
This new tax law that would change the following
1. Will eliminate the investment tax credit for the new equipment
2. To extend depreciation lives for new equipment
3. Reduce corporate tax from 46% to 34 %
Jane Rogers took into consideration the envisaged tax law in representing the new offer to PaperCo.
This paper covers the different options that would assist PaperCo in arriving at the best investment decision.
The paper utilises the Net Present Value and the Internal Rate of Return techniques, to arrive to a most feasible and enticing investment option for …show more content…
Last year (1984) investment in new drying equipment pursuant to Option 1 was not pursued despite its attractiveness as a viable capital project, perhaps because it was possible that a better alternative might arise. However, given the impending tax legislation, the possible alternatives are now known, and they are not good. Under the new tax legislation without grandfathering, the project is not viable. Paperco should invest in the paper drying equipment because not doing so soon enough is not a viable alternative, while investing in the equipment is a viable alternative (i.e., the Net Present Value of the project is