Capital Budgeting and Cash Flow Analysis

This assignment provides a comprehensive example of capital budgeting and cash flow analysis. It includes a detailed calculation of net present value (NPV), internal rate of return (IRR), and payback period for a project with initial investment of £40 million and salvage value of £0. The cash flows are calculated over 5 years, with sales revenue, direct material, direct labor, fixed overhead apportioned, and variable overhead costs. The assignment also includes a detailed breakdown of the calculations, including cumulative cash flow and discounted cash flow, to facilitate understanding of the concepts.