of funds is expected to produce benefits over a period of time greater than 1 year. E11-2. Classification of project costs and cash flows Answer: $3.5 billion already spent—sunk cost (irrelevant) $350 million incremental cash outflow—relevant cash flow $15 million per year cash inflow—relevant cash flow $450 million for satellites—opportunity cost and relevant cash flow E11-3. Finding the initial investment Answer: $20‚000 Purchase price of new machinery $3‚000 Installation costs $4‚500 After-tax
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Foods’ Year 0 net investment outlay on this project? What is the expected non-operating cash flow when the project is terminated at Year 4? (Hint: Use Table 1 as a guide.) Year 0 net investment outlay = 835‚000 Expected non-operating cash flow when the project is terminated at Year 4 Salvage Value= 87‚500 Salvage Value Tax= 35‚000 Recovery of NWC= 30‚000 Termination CF= 82‚500 7. Estimate the project’s operating cash flows including cannibalization effects but
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For example‚ the classification of dividends paid is different under AIFRS and IFRS. Under AIFRS‚ dividends paid should be put into cash flows from financing activities. Whereas‚ dividends paid can be classified as cash flows from financing activities or from operating cash flows in order to help users to decide the ability of an corporation through operating cash flow to pay dividends.( Porter B‚2005) Source: David Jones‚ ‘statements of financial performance 2005’www.davidjones.com.au Measurement
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referred to as the Red Sheds by New Zealanders had hit rocky ground with a list of failed ventures (including Warehouse Australia)‚ a plummeting share price $8.50 in 2000 falling to $2.50 2012 (partly due to the global financial crisis)‚ falling operating profit and stagnant revenue growth. Some local distributors were reluctant to supply the store for fear of brand damage and their supply chains lacked the diversity to provide on-going profit margins. In 2008 WHS was the target of potential takeovers
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3. Estimation page 3 4. Accounting data Number of planes page 4 Ticket revenue page 4 Operating Cost page 5 Deprecation page 5 Operating cash flows page 5 NPV page 5 5. Evaluation page 6-7 6. Appendix Introduction Fly-by-night
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“Compare the relative advantages and limitations of financial statements prepared on a cash basis with those prepared on an accrual basis” To compare the advantages and limitations of different financial statements begins with first understanding what financial statements are and what different purposes they can be used for‚ as well as the differentiation between cash and accrual accounting. The cash and accrual methods of accounting are the two principle ways of keeping track of businesses takings
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labor costs. The firm’s marginal tax rate is 40 percent. b. What are the net operating CFs in Years 1‚ 2‚ and 3? Year Depr. % Depreciation (Base=$170) 1 .33 $56.1 2 .45 $76.5 3 .15 $25.5 Cost-savings -Depr $50 $56.1 $50 $76.5 $50 $25.5 Taxable Inc. -Taxes a. What is the net cost of the spectrometer‚ that is the Year 0 project CF? Base price Modification Increase in NOWC Cash outlay for new machine 2 -$6.1 -$2.44 -$26.5 -$10.6 $24.5 $9.8
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From Disney’s perspective‚ despite Chase’s standard commitment letter leaving them slightly vulnerable‚ choosing Chase as sole mandate made the most sense. Due to the unique nature of the loan (extreme long term‚ Disney’s desire to use operating cash flow for expansion and the principal collateral being non-existent for first 2 years)‚ it made sense for Disney to choose a company that has a strong relationship with and one that was extremely flexible on the structuring of the loan. Finally
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098 | 6‚765 | Total comprehensive income | 16‚492 | 4‚365 | Sales | 59‚214 | 65‚622 | Total assets | 112‚773 | 119‚545 | Current assets | 21‚459 | 21‚898 | Current liabilities | -12‚876 | -14‚966 | Cash flow from operating activities | 23‚530 | 27‚388 | Net cash flow from operating activities | 18‚277 | 20‚030 | (Sources: <http://www.riotinto.com/annualreport2011/pdf/rio_tinto_2011_annual_report.pdf >) The table above includes many financial data which can be used to analyze
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includes FIN 571 Week 6 Furniture Store Recommendation Cash Per Forma Resource: The Guillermo Furniture Store Scenario or your own organization‚ with the approval of your instructor‚ for this assignment Write a paper in no more than 2‚100 words that analyzes Guillermo’s alternatives and make a recommendation of a financial decision. The paper must also include a justification for your recommendation. Create a pro forma cash flow budget for the organization for at least the next
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