Financial Viability of Proposed Project: Investment Appraisal Techniques

Running head: FINANCE
Finance
Name of the Student:
Name of the University:
Authors Note:

FINANCE
1
Table of Contents
1. Financial Significance of the Proposed project:.....................................................................2
2. Conducting Memo to Pinto’s CEO explaining and justifying the recommendation for the
proposed project:........................................................................................................................4
Reference and Bibliography:......................................................................................................8

FINANCE
2
1. Financial Significance of the Proposed project:
Particulars Year 1 Year 2 Year 3 Year 4 Year 5
Sales Volume
200,000 300,000 450,000 225,000 112,500
Sales price $
75
$
77
$
80
$
82
$
84
Revenue $
15,000,00
0
$
23,175,000
$
35,805,375
$
18,439,768
$
9,496,481
Cost of goods sold $
9,000,000
$
13,905,000
$
21,483,225
$
11,063,861
$
5,697,888
General and
administrative expenses
$
1,000,000
$
1,050,000
$
1,102,500
$
1,157,625
$
1,215,506
Rent $
250,000
$
250,000
$
250,000
$
250,000
$
250,000
Depreciation $
3,000,000
$
3,000,000
$
3,000,000
$
3,000,000
$
3,000,000
Profit before Tax $
1,750,000
$
4,970,000
$
9,969,650
$
2,968,282
$
(666,914)
Tax $
525,000
$
1,491,000
$
2,990,895
$
890,485
$
(200,074)
Profit after Tax $
1,225,000
$
3,479,000
$
6,978,755
$
2,077,798
$
(466,840)
Value $ $ $ $ $