performance measures (NPV‚ IRR‚ MIRR and Payback period) to decide whether to buy or build the technology. First of all‚ I use the given data to make the assumptions for both buy and build analysis. Next‚ I use the assumptions to calculate the after-tax cash flow. Last but not the least‚ I have the after-tax cash flow and I use excel to calculate the NPV‚ IRR‚ MIRR‚ and Payback period. From NPV perspective‚ both buying and building the technology are acceptable because these two projects NPV is positive.
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1. Using a spreadsheet‚ determine the NPV of the acquisition of Skates’n’Stuff. Based on your numerical analysis‚ should Blades establish a subsidiary in Thailand or acquire Skates’n’Stuff? In Excel (have attached)‚ the acquisition NPV is $4‚121‚929.95‚ and establishing a new subsidiary NPV is $8‚746‚688. Other point is Blades acquires the company‚ it could begin sales immediately and would not require an additional year to build the plant in Thailand‚ so the action can save cost. Thus‚ the establishment
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Robert Carper (International Exchange Program) Pratyush Fnu (International Exchange Program) Yan Guo (International Exchange Program) Zejian Yang (International Exchange Program) Groupe Ariel S.A. Abstract Groupe Ariel is a company that manufactures and sells printers‚ copiers and other document production equipment. The case focuses on an investment project in the company’s Mexican subsidiary that would expand operations into a new market‚ something it been slow to do in the past. Groupe Ariel
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NEW HERITAGE DOLL COMPANY Capital Budgeting NEW HERITAGE DOLL COMPANY Capital Budgeting Brief Case Brief Case Brief Case Brief Case Brief Case Brief Case Brief Case Brief Case To: CFO (New Heritage Doll Company) From: Date: 11/16/12 RE: NEW HERITAGE DOLL COMPANY To: CFO (New Heritage Doll Company) From: Date: 11/16/12 RE: NEW HERITAGE DOLL COMPANY Here a composite report is advanced on the toy industry‚ New Heritage Doll Company and the evaluation of
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implemented within organizations is defined and reported. Key terms related to capital budgeting are also defined. Risk analysis based on the Net Present Value (NPV) is performed on the salvage values before and after sales tax values along with the different sale ranges. Keywords: NPV‚ NPV Profile‚ NPV‚ IRR‚ multiple IRRs‚ ranking conflict of NPV vs. IRR‚ payback period‚ profitability index‚ discount rate‚ cost of capital concept‚ cash flow analysis‚ cash flow timeline‚ conventional cash flow stream
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provide an NPV of around $17‚000. That NPV while positive is nowhere near what Tremont would like out of their investment. The base IRR for the build option is low because it generates most of its value in the later years of the project. This makes it more sensitive to changes in the discount rate. The WACC can go as low as 25% below the base value and as high as 75% above the base value. The higher the WACC the lower the NPV. The build option has a number of scenarios that put its NPV extremely
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to prominent labour issues‚ including increasing levels of absenteeism and turnover. Options: 1. Plant Closure and Product Line Transfer As seen in Appendix 1‚ closure of the Detroit plant and transfer of product lines results in the best NPV of the three options‚ using the financial information provided in the case. However‚ the financials in isolation do not consider the impact of the transfer of product lines to the other plants‚ as well as the impact of Group 3 product line discontinuation
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ROIC/Payback period versus the NPV method of project valuations. The bottom-line is that NPV method has definite advantages over the other methods. (2-3 pages) In the third part we show that we will do the project valuation according to the NPV. We introduce the three excel sheets and write the conclusions of the three excel sheets. We talk on the basic assumptions we take to do the NPV calculations and discuss the final bottom-line. The bottom-line is that the NPV is negative and hence this
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To: Michael Campbell‚ General Manager‚ Phuket Beach Hotel From: Albert‚ Andy‚ Becca‚ Chris‚ & Derek Consulting Date: June 14‚ 2011 Re: Valuation of Potential Karaoke Pub Projects Thank you for retaining AaBCD Consulting in the valuation of your future capital improvement project. There are two mutually exclusive capital improvement projects under consideration: lease under-utilized space to an unrelated third party‚ Planet Karaoke Pub‚ or invest greater capital to open and manage your own
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CASE REPORT OF FINANCIAL MANAGEMENT Diamond Chemicals PLC (B) Merseyside and Rotterdam Projects Table of content Key Issues 3 Analysis 3 Recommendations 8 Appendix 9 Appendix 1: Company Description 7 Appendix 2: Calculation on Merseyside Project Revision 7 Appendix 3: Calculation on Rotterdam Project without Right-of-way 7 KEY ISSUES The Diamond Chemical PLC as the producer of polypropylene has two production plants which are in Merseyside and Rotterdam. Both factories
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