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Replacement Project Excel

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Sakshi Sharma
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39 views4 pages

Replacement Project Excel

Uploaded by

Sakshi Sharma
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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INITIAL INVESTMENT

Fixed capital investment (FCI) (400,000)


+ Working Cap (NWC) (60,000)
Initial Investment (460,000)

Tax rate on net income 25%


Required Return 10%

OPERATING CASHFLOWS 2020 2021 2022


Revenues 250,000 250,000
-Total Expenses 90,000 90,000
EBITDA 160,000 160,000
- Depreciation 80,000 80,000
EBIT 80,000 80,000
-Tax 20,000 20,000
EBIT(1-t)/PAT/NI 60,000 60,000
+ Depreciation 80,000 80,000
After-Tax Operating Cash Flow (460,000) 140,000 140,000
Discount Rate 10%

Terminal CF 2020 2021 2022


Machinery 0 0
Working Capital 0 0

Total after-tax cash flows -460,000 140,000 140,000

NPV (Net Present Value) 508,192


IRR (Internal rate of Return) 29.49%
Old Machinery Amount

Current market value 500,000


Remaining life 10 years
Sales 250,000
Total Expenses 110,000
Annual depreciation 40,000

2023 2024
250,000 250,000
90,000 90,000
160,000 160,000
80,000 80,000
80,000 80,000
20,000 20,000
60,000 60,000
80,000 80,000
140,000 140,000

2023 2024
0 0
0 0

140,000 140,000
New Machinery Amount

Acquisition cost 900,000


Life 10 years
Sales 500,000
Total Expenses 200,000
Annual depreciation (without factoring in any salvage value) 120,000
Expected salvage value 220,000
Tax Rate 25%
Incremental NWC Investment 60,000

2025 2026 2027


250,000 250,000 250,000
90,000 90,000 90,000
160,000 160,000 160,000
80,000 80,000 80,000
80,000 80,000 80,000
20,000 20,000 20,000
60,000 60,000 60,000
80,000 80,000 80,000
140,000 140,000 140,000

2025 2026 2027


0 0 0
0 0 0

140,000 140,000 140,000


2028 2029 2030
250,000 250,000 250,000
90,000 90,000 90,000
160,000 160,000 160,000
80,000 80,000 80,000
80,000 80,000 80,000
20,000 20,000 20,000
60,000 60,000 60,000
80,000 80,000 80,000
140,000 140,000 140,000

2028 2029 2030


0 0 220,000
0 0 60,000

140,000 140,000 420,000

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