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Npv and irr

Forums › ACCA Forums › ACCA FM Financial Management Forums › Npv and irr

  • This topic has 1 reply, 2 voices, and was last updated 1 month ago by mrjonbain.
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  • February 14, 2023 at 11:27 am #678872
    bahisaab@
    Participant
    • Topics: 1
    • Replies: 0
    • ☆

    Drabanga plc has purchased a robot.they have paid an initial investment of an 50000 for maket survey and for manufacturing 400000.the product life is expected to be 4 years abd the company expects scrap proceed of 75000 end of project. Demand estimated
    Year1. Year 2. Year 3. Year 4
    Demand. 3000. 4000. 5000. 6000
    The selling price is 60 and the variable selling per unit 20 .The annual fixed cost of estimated 75000 which includes 50000 depreciation and 5000 apportioned headquarter cost

    Tax is paid at the rate of 30% and is payable I. The same Year working capital is required which is equal to 10% of annual sales this will need to be placed at the start of each year

    Capital allowance are available at the rate 25% reducing balance the company had a cost of capital of 10%

    Calculate the npv of rhe project
    Calculate the irr of the project

    February 14, 2023 at 3:24 pm #678882
    mrjonbain
    Moderator
    • Topics: 2
    • Replies: 1599
    • ☆☆☆☆☆

    bahisaab@, welcome to the Opentuition forums. Would you please give a few more details about the issues or difficulties you are having with the above calculations.

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