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Managerial Finance: Analysis of a Manufacturing Project by Dell

   

Added on  2022-11-14

9 Pages1857 Words331 Views
Running head: MANAGERIAL FINANCE
Managerial finance
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1MANAGERIAL FINANCE
Executive summary
Aim of the report is to analyse one manufacturing project that is planned by Dell to be started
in near future. However, the company wants to evaluate the project in context of its
profitability before investing the amount. Different methods those will be used for the
project’s analysis are NPV approach, IRR and payback period. In addition to that the project
will be evaluated based on the new financial discipline adopted by it.

2MANAGERIAL FINANCE
Table of Contents
Introduction................................................................................................................................3
Question 1..................................................................................................................................3
(a) Expenses for yearly depreciation.................................................................................3
(b) Year 1 to 9 – yearly cash flows...................................................................................3
(c) Year 0 – cash flow.......................................................................................................4
(d) Year 10 – cash flows...................................................................................................4
(e) Calculation of NPV and interpretation........................................................................4
(f) Payback period and IRR and interpretation................................................................5
(g) Applying same discount rate for all the projects.........................................................6
Question 2..................................................................................................................................6
(a) Maximum rate of interest............................................................................................6
(b) Pros and cons of new requirement...............................................................................6
Conclusion and recommendation...............................................................................................7
Reference....................................................................................................................................8

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