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Financial Analysis - Assignment Sample

   

Added on  2021-06-17

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Running head: FINANCIAL ANALYSISFINANCIAL ANALYSISName of the Student:Name of the University:Author’s Note:
Financial Analysis - Assignment Sample_1

FINANCIAL ANALYSIS1Table of ContentsAnswer to Question 1......................................................................................................................2Answer to Question 2......................................................................................................................6Answer to Question 3......................................................................................................................7Answer to Question 4......................................................................................................................8Answer to Question 5......................................................................................................................9Introduction..................................................................................................................................9Gaps in Life Cycle Costing..........................................................................................................9Recommendations......................................................................................................................11Reference.......................................................................................................................................13
Financial Analysis - Assignment Sample_2

FINANCIAL ANALYSIS2Answer to Question 1The annual worth of the company represents the annual equivalent value of all cashinflows and cash outflows of the alternatives options (2). This method is usually used for makingcomparison between the viability of two projects. In this method only one life cycle of theproject is to be evaluated. Present worth is used to estimate the future cash inflows from a projectand is normally used in capital budgeting techniques. Internal Rate of Return is the rate at whichthe present value of the cash inflows and cash outflows becomes zero (4).Capital Investment decision are often based on the analysis of Annual Worth, PresentWorth and Internal rate of return. The annual worth of the projects helps the business in makingcomparison between alternative projects with the proposed projects. The present worth of theproject is used by businesses to determine the present value of cash inflows which the businesscan expect from the project (3). The IRR of the project determines the minimum rate of returnwhich the company needs to earn. These are important factors which are needed to be consideredwhile taking investment decisions.
Financial Analysis - Assignment Sample_3

FINANCIAL ANALYSIS3Degree A:Particulars0123456Initial Investment-$10,000Operating Cash Flow:Sales Volume500050005000500050005000Selling Price per unit$3$3$3$3$3$3Sales Revenue$15,000$15,000$15,000$15,000$15,000$15,000Annual Labour Cost-$9,000-$9,000-$9,000-$9,000-$9,000-$9,000Annual Power & Maintenance Cost-$500-$500-$500-$500-$500-$500Depreciation -$1,667-$1,667-$1,667-$1,667-$1,667-$1,667Net Profit before Tax$3,833$3,833$3,833$3,833$3,833$3,833Less: Income Tax-$1,150-$1,150-$1,150-$1,150-$1,150-$1,150Net Profit after Tax$2,683$2,683$2,683$2,683$2,683$2,683Add: Depreciation$1,667$1,667$1,667$1,667$1,667$1,667Net Operating Cash Flow$4,350$4,350$4,350$4,350$4,350$4,350Salvage Value:Salvage Value $500Less: Income Tax-$150Net Salvage Value$350Net Cash Flow-$10,000$4,350$4,350$4,350$4,350$4,350$4,700After Tax Rate of Return10%Annual Worth-$11,731.27Present Worth$16,450IRR37.16%Years
Financial Analysis - Assignment Sample_4

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