A company is deciding whether to expand its production facilities. Management has projected the following information...
A company is deciding whether to expand its production facilities. Management has projected the following information over the next two years
| Year 1 | Year 2 | |
| Revenues | 125 | 160 |
| COGS | 40 | 60 |
| Depreciation | 25 | 36 |
| Increase in NWC | 5 | 8 |
| Capital Expenditures | 30 | 40 |
| Tax rate | 35% | 35% |
What is the net income and free cash flows for both years?
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A company is deciding whether to expand its production
facilities. Management has projected the following information...
Elmdale Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult...
Elmdale Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years (in millions of dollars): Year 1 Year 2 Revenues 112.3112.3 153.8153.8 COGS and Operating expenses (other than depreciation) 49.649.6 55.555.5 Depreciation 29.729.7 37.437.4 Increase in working capital 5.45.4 8.38.3 Capital expenditures 28.328.3 40.240.2 Corporate tax rate 20 %20% 20 %20% a. What are the incremental earnings for this project...
deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management...
deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years (in millions of Elmdale Enterprises dollars) Year 1 Year 2 160.7 64.7 Revenues 111.8 COGS and Operating expenses (other than depreciation) Depreciation Increase in working capital Capital expenditures Corporate tax rate 43.7 28.3 33.3 5.1 8.5 34.1 44.2 20 % 20% a. What are the incremental eamings for this project for years 1...
Elmdale Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult...
Elmdale Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years (in millions of dollars): Yoar 2 D 152.1 Revenues COGS and Operating Expenses (other than depreciation) Depreciation Increase in Net Working Capital Capital Expenditures Marginal Corporate Tax Rate Year 1 128.4 40.8 20.7 2.7 25.8 35% 55.9 25.3 8.8 39.6 35% a. What are the incremental earnings for this project...
Elmdale Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult...
Elmdale Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years (in millions of dollars): Year 1 118.1 46.9 28.7 Revenues COGS and Operating expenses (other than depreciation) Depreciation Increase in working capital Capital expenditures Corporate tax rate Year 2 156.8 50.9 38.2 8.7 40.8 20% 3.7 28.3 20% a. What are the incremental earnings for this project for years 1...
Stanley Industries is evaluating a proposal to expand its current distribution facilities. Management has projected that...
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Need help with this finance question. Both part a and b Elmdale Enterprises is deciding whether...
Need help with this finance question. Both
part a and b
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For
mutually exclusive projects, explain why picking one project over
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Please do this in excel and show work. Also the numbers are in the millions. =...
Please do this in excel and show work.
Also the numbers are in the millions.
= Merge & Center $ % 9 8 % Conditional Form Formatting Table Styles Clipboard Font Alignment Number A1 D м н о р о B a. What are the incremental earnings for this project for years 1 and 2? b. What are the free cash flows for this project for years 1 and 2? $ 160 Year Sales Operating Expenses (other than depreciation) Depreciation...
deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years (in millions of Elmdale Enterprises dollars) Year 1 Year 2 160.7 64.7 Revenues 111.8 COGS and Operating expenses (other than depreciation) Depreciation Increase in working capital Capital expenditures Corporate tax rate 43.7 28.3 33.3 5.1 8.5 34.1 44.2 20 % 20% a. What are the incremental eamings for this project for years 1...
Elmdale Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years (in millions of dollars): Yoar 2 D 152.1 Revenues COGS and Operating Expenses (other than depreciation) Depreciation Increase in Net Working Capital Capital Expenditures Marginal Corporate Tax Rate Year 1 128.4 40.8 20.7 2.7 25.8 35% 55.9 25.3 8.8 39.6 35% a. What are the incremental earnings for this project...
Elmdale Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years (in millions of dollars): Year 1 118.1 46.9 28.7 Revenues COGS and Operating expenses (other than depreciation) Depreciation Increase in working capital Capital expenditures Corporate tax rate Year 2 156.8 50.9 38.2 8.7 40.8 20% 3.7 28.3 20% a. What are the incremental earnings for this project for years 1...
Stanley Industries is evaluating a proposal to expand its current distribution facilities. Management has projected that the project will produce the following additional cash flows for the first two years (in millions) Year Revenues Operating Expense 1200 1400 450525 240 280 Depreciation Increase in working capital 60 Capital expenditures Marginal corporate tax rate 30% 70 350 30% 300 Note 1: the incremental EBIT from the project refers to the additional (incremental) cash flows in each year as given in the...
Need help with this finance question. Both
part a and b
Elmdale Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years (in millions of dollars): 2 Year 1 124.3 45.7 29.5 2.4 26.8 35% Year 2 167.8 63.3 37.9 Revenues COGS and Operating Expenses (other than depreciation) Depreciation Increase in Net Working Capital Capital Expenditures Marginal Corporate Tax Rate 8.6...
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For
mutually exclusive projects, explain why picking one project over
another because it has a larger IRR can lead to mistakes.
QUESTION 2 ABC Enterprises is deciding whether to expand its production facilities. Although long-term cash flows are difficult to estimate, management has projected the following cash flows for the first two years (in millions of dollars: Items Year 1 Revenues 112 Costs of Good soles and operating expenses 47.7 Depreciation 25.9 Increase in net working capital 3. 1 7...
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Please do this in excel and show work.
Also the numbers are in the millions.
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