Home Work Excel Solution

Que 1 Part - A

 T=0 T=1 $ (110,000) $

1 Cash Cash Flow Flow 2 Discount Discount Rate Rate @ 10% 3 &'  NPV( NPV( Inf Infow ow-O -Out utfo fow) w) Part- B

$ $

1 (110,000) $ 3,72 3,721 1

T=2 30,000 30,000 0.01 2,23

T=3 ### $ 30,000 30,000 0.!2"

$

2,2 2 ,2

0.13 $

22,3 2 2,3

Ree Doc. *otes +-oe/ achine e-laceent  T=0 T=1

Part- C

T=2

T=3

1 Cash Cash Flow Flow utow $

(10,000)

+nceental Reenue

$

2 Discount Rate @ 10%

1

3 &'

$

(10,000) $

 NPV( Infow-Outfow)

$

1,628

0,000

### $

0.01 3",3"

0.!2" $

33,0" 3 3,0"

 0 ,0 0 0 0 .  1 3

$

30,02 3 0,02

QU -2

 A Mini-case on Relevant Cash Flows (6 Points) +tes (in thousan/s o /oll T=0 1 Reenues 2 Raw ateial Costs 3 Diect costs  De-eciation  4+T (152535) " Ta6 Rate 0% o   *&7T (5") ! +ncease in +nentoies  Ca-ital 6-en/itues 10 Cash Flow o &o8ect (9 11 *&' o line 10 @11%

T=1 to  T= 12,000 12,000 ,000 ,000 1,000 1,000 ,000  ,0 0 0 3,000 3,000 1,200 1,200 1,!00 1,!00 500 0  00 520,000 0 0 520,00 ,!00 " ,2 0 0 $1,2

The cash cash flow flow projec projectio tions ns did did not inclu include de effec effectt of accoun accounts ts receiv receivabl ables es and and payabl payables. es. The The ave expected to be 50 days, and 36 days respectively based on 365 days. Chan:e in ;CR 7ccounts eceia
7ccounts &a?a
(sales3")> 0

 Total +now  T= T= $ 30,000 $ 30,000 $ 10,000 0."!3 $

20,0

 T=

$

0,000

0."20 $

2,320

113,21

T=

 Total

$

0,000 $ 200,000

0."!3 $

1!,"2 $

0."20 $

2,!3"

3.0 $ 1!1,628

 The  e-laces the ol/ achine with new ac i-oe/ achine
age collection period for receivables and average payment period for payables are

ine. Two ?eas late, a s the Be6istin: achi chine will cost $10,00 oe the -eious a e-eciate/ on a stai:h e

Ca"#u"aton o% Co&t o% Ca'ta" Part A Part#u"ar& 1. E 2. D 3. AD % . E7 (4usiness RisA)1 E7 = E 19DG1 . % 4usiness RisA 1 ". % Financial RisA (1005line ) . E o sa-le isI E7 619(D)G 1 ! " # x$%& '%(t) *+!

Part B

!. AH = RF 9 R& 6 E . ;7CCH = AD(15T)6 D(D9) 9 A 6 D9 (D9) D(D9) Ree the /ocuent le

A

B 1.2 1.2 " 0.3 3% %

0. 1.!  0.33 33% "%

1.00 .0 .! 0. 0."

0. .03! . 0.3 0."

C





1.3 1.3 . 0. % 3%

1. 1. .2 0. % "%

1.12 .0" .1 0.3 0.

1.1! .0 .0 0.3 0."3

Aera*e 1. 1.3 3. 1.1 !. .2 0.3 0."" 3% % "% 3% 1.1 .0"0 . 0.23 0.

1.0 .0 .10

Homework on Financial Analysis: QU - 1

PA+- A ana*era" In#o.e /tate.ent 2003 1 Jales 2 4+T 3 NOPA (26)  +nteest 7 Ta6 ! Net In#o.e

ana*era" Ba"an#e /4eet " Cash  7ccts. Receia
ana*era" Ca&4 :"ow /tate.ent 1! *&7T 1 De-eciation 20 O'eratn* Ca&4 :"ow (181) 21 Chan:e +n Cash 4alance 22 Chan:e in ;CR 23 Chan:e in *et Fi6e/ 7ssets 2 De-eciation 2! Ca'ta" 'enture& (232) 2" Ine&t.ent C: (222!-21) 27 :ree Ca&4 :"ow(2026) 2! :nan#a" Ca&4 :"ow& 2 +nteest 7te Ta6es 30 Chan:e in Jhot Te De
110

20  $ 22,100 "0 386 "" 320

130

"00 2,30 2,!00 1,00 200

3,100 3,200 1,"00 2"0

3,30 1,200 !,730 300 1,300 ,130 !,730

3! 0 20 510 5100 0

5! 200 5100 5200 0

3! C: to 
0

200!  $ 2,300 00 !38 ! 60

2"

30

+e.ar=& $ 31,"00 1,30 810 Ta6 @0% 1"0 6!0

300 ,200 ,300 2,00 30

,0 1,300 6,00

6,100 1,0 7,80

00 1,200 ,30 6,00

1,00 1,100 ,!0 7,80

Infow or Outfow !10 0 3!

!10 Infow 0 51,""0 510 0

5100 -360 1!

51,"10 utow

510 utow

0 Outfow 1"0 5100 100

22

outow +now 5110 +now

200 0

5200 -178

200 outow 0 Infow

Homework on Financial Analysis: QU - 1

PA+ - AB> - 1

ANA?+IA> BA>ANC /@  CA/@:>

BA>ANC /@ Item

New Amt

INCO /A

l! Amt

Item

-ash

%,/5

300

%. 1ales

2-

3%5

6,%00

"# $%I&

 4et ixed #ssets

%0

%,0

3. 478#T

Investe! Ca'ital

*+

,.*+

. 9nterest% 5. 9nt. #fter Tax

1hort Term *ebt

0

%,:00

6. !;T '()


%%00

%,%00

=. Tax 0> of 6

7wners !?uity

/0

,/0

/. 4et 9ncome'3(5 or 6(=)

Ca'# $m'loye!

*+

,.*+

/ivi!en!s

&at DH 7ssue that  can i-oe its cash conesion c?cle o 200 s i. +t will hae an aea:e collection -eio/ o 30 /a?s, an aea:e -a? ii. +nento? tunoe o !. iii. 7ccue/ e6-enses will eain unchan:e/. i. Futhe assue that inteest e6-ense will
O5 /AN

N

CA/@ :>O5 /AN

Amo0nt

Item

Amo0nt

/%0

+now

1""

+now

3. ∆ 4et ixed #ssets

(%0

utow

5

. ∆ -ash ;alance

(:35

3

# FCF (13"323*)

6+

3%,600 12+

/%0

%,:6

%. 478#T .6 x !;9T "#

5CR 

6. *ividends

Infow

(3/

5%/

,# Int# A# &a4es

==/

/. ∆ 1.T @
(600

2".

# FCF (63,3.)

-6+ Outfow

ch that nt -eio/ o 33 /a?s.

/ to -a? shot te /e
-2"

AB> -2 Item

ormula

5or=n* Ca'ta" +e
Acco0nts Receivale

Inventories

1ales+365 x 30 days

-7A1+/

3%600+365 x 30

5%00+/ "

 4ew #BT 005

Acct# Payales '-7A1 & ∆ 9nventory)+365x 33

5%00&'300(300)+365 x 33 "

2

313!

210

7ld #BT 005

,00

,300

,050

7ld #BT 00

3,100

3,200

1,"00

Chan7e in 5CR 

Decese in 7ccounts Receia
03 +now "3 +now 0 0 1,22!

New 5CR 8 A9R 3 Inventory  A9Payale  Accr0e! $4'

Accr0e! $4'

5CR  

30 30

321! "100

2"0

0

Homework on Financial Analysis: QU - 1

PA+-B

Com'0te R$ RIC an! their com'onents ;or "++:

(* 'oints)

R$ 8 Net Inc 9$<0ity 8 !;9T+1ales x 1ales+9nv. -ap x !;T+!;9T x 9nv. -ap+!

Bargin x Turnover x 9nt. actor x Part#u"ar& :or.u"ae 1 -. a:in 4+TJales 2 Tunoe Jales+n. Ca-ital e3 R+C4Ta6 4+T+n. Ca-ital e +nt. Facto 4T4+T  Ke. Facto +n. Ca-Luit? " Financial ulti-lie 4T4+T 6 +n Ca-Luit?  Ta6 Facto *et +nc4T ! R *et +ncLuit? 7ltenate FoulaH R = *et. +ncLuit? = R+C7T 9 (R+C7  R+C7T 10 +nt. Rate4T 11 +nt. Rate7T 12 J-ea/ (511) 13 De
*&7T+nCa+nt.Total De
PA+ - C Ree the Docuent le o ans.

uity x 4et 9nc+!;T

ev. actor x Tax actor 2003 "022100 2.0% 2210030 3.!" "030 11.3% 0"0 0.!3 30130 1.3 0.!3 6 1.3 1.1 3200 0. 320130 .% O +nt. Rate7T) 6 De
".% ".!!% .13% 2."3% 3!.0% .%

200

200

ReaAs

3.0% 3. 1.!0% 0.!" 1.3 1.2 0." 10.!%

% .031 1% 0.!0 1."20 1.30 0."0 13.3%

!.!3% ."% .% .2% 3!.0% 10.!%

10.33% !.0% .33% .00% "1.!% 13.3%