Victoria Chemicals: The Merseyside Project Executive Summary Victoria Chemicals is facing pressures from investors to improve its financial performances. The plant manager is currently considering whether to accept a GBP 12million initial outlay project to renovate its polypropylene production line at Merseyside plant. The benefit of the plant is the lower energy requirement of production and a greater manufacturing capacity. This report consist a recommendation for the plant manager which consists
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Case #22 Victoria Chemicals Synopsis and Objectives go/no-go decision 1. The identification of relevant cash flows; in particular‚ the treatment of: a. sunk costs b. cash flows obtained by cannibalizing another activity within the firm c. exploitation of excess transportation capacity d. corporate overhead allocations e. cash flows of unrelated projects f. inflation. 2. The critical assessment of a capital-investment evaluation system
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Group Paper Analysis‚ Team 4 4/22/2010 Victoria Chemicals (B) Group Case Study Introduction Victoria Chemicals’ Intermediate Chemicals Group (ICG) is evaluating two mutually exclusive proposals on their capital expenditures. The Liverpool and Rotterdam plants have compiled separate proposals. Each proposal had the potential to increase the polypropylene output by 7 percent for their plant respectively. Victoria Chemicals could not view a 14 percent increase companywide being feasible‚
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NYIT School of management Report CASE STUDY 22: VICTORIA CHEMICALS PLC(A) CAPITAL BUDGETING DECISIONS SUBMITTEDTO: DR.RAJA NAG PREPARED BY: SEVTAP BATIR HONEY MEHTA JUN HUANG NYIT School of management Report CASE 22 Victoria Chemical In 2007‚ Victoria Chemicals experienced a significant drop in its improve its performance as its earnings had fallen 38% from 250 pence per share to 180
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CASE 1 - A CASE STUDY OF VICTORIA CHEMICALS Corporate Finance (FEG304) Table of Contents 1.0) Introduction This report contains two case studies in the discourse of Corporate Finance‚ more specifically capital investment strategy. The cases are applied on the fictional company Victoria Chemicals and are divided into (A): “The Merseyside Project and Victoria Chemicals” and (B): “The Merseyside and Rotterdam project”. The cases are picked from the book “Case Studies
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Case Study Week 3 - Victoria Chemicals PLC 1. What changes‚ if any‚ should the plant manager (Morris) ask the financial controller (Greystock) to make to his analysis? Morris should ask the Financial Controller to the make the following changes to his analysis: • Include the cost of the rolling stock. These would become an essential asset of the Merseyside Works. The investment to occur in 2010 and then depreciated over the following 10 years. These would become an asset of the Merseyside works
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analysis and recommendation about the Merseyside Project with you. Your DCF analysis is excellent and helpful. However‚ I have to make some changes to it. The memo will be divided into 6 parts. Suggestions for Merseyside project: P1 What should change in the DCF analysis and why: P1-P3 Other important issues: P3-P4 Evaluation of each investment Criteria: P4-P5 Ultimate recommendation and forward looking: P5-P6 Revised DCF analysis: Appendix Changes to capital project? Since reviewing
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Victoria Chemicals PLC: The Merseyside Project Prepared by Gabriela Tiffany Executive Summary The purpose of this report is to provide an understanding and analysis regarding the project proposed. The report starts with a brief overview of the company and the project proposal. This report then continues with assessing the concerns of Transport Division‚ ICG Sales and Marketing Department‚ and Treasury Staff. Furthermore‚ this proposal will also evaluate the recommendation from the Assistant Plant
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VICTORIA CHEMICALS PLC Ricky Tjayadi 01120120028 Young Jung Kim 01120120201 Irene 01120120214 VICTORIA CHEMICALS PLC The Background Victoria Chemicals‚ a major company in the chemical industry‚ was the number one producer of polypropylene‚ a polymer used in various everyday items. Victoria Chemicals at the end of 2007 was in a financial slump and was under pressure to improve their financial performance. Due to this financial slump‚ Lucy Morris‚ the Plant
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of the prior year to January 1st of the current year. The rate increase be re-evaluated each year‚ however‚ the rate cannot decrease the payment amount. The most recent change in the CPI was 4%. * * * Research Question * * Should the costs‚ or potential costs‚ associated with the increase in the CPI be included in “minimum lease payments” as defined in ASC 840? * * Relevant Literature * * According to ASC 840-10-25-4 and ASC 840-10-55-39 – if lease payments
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