Capital Budgeting Worksheet Essay Example for Free

Capital Budgeting Worksheet set aboutRead the scenarios below and select one to review and analyze. Determine the proposals appropriateness and frugal viability. For all scenarios, assume spending occurs on the first day of each year and benefits or savings occurs on the last day. Assume the discount rate or weighted average cost of crown is 10%. Ignore taxes and depreciation.Proposal A modernistic FactoryA company wants to build a modern grinder for increased capacity. development the net present value (NPV) method of capital budgeting, posit the proposals appropriateness and economic viability with the following informationBuilding a new factory resulting increase capacity by 30%. The current capacity is $10 million of gross sales with a 5% profit margin.The factory costs $10 million to build.The new capacity will meet the companys needs for 10 years.The factory is worth $14 million everyplace 10 years.Proposal B New EquipmentA company wants to buy a tire-saving pi ece of equipment. exploitation the NPV method of capital budgeting, determine the proposals appropriateness and economic viability with the following information apprehend content is 12% of sales, which are annually $10 million.The new equipment will save 20% of labor annually.The new equipment will last 5 years.The new equipment will cost $200,000.Proposal C New Advertising ProgramA company wants to invest in a new advertising program. Using the NPV methodof capital budgeting, determine the proposals appropriateness and economic viability with the following informationThe new program will increase current sales, $10 million, by 20%.The new program will have a profit margin is 5% of sales.The new program will have a 3-year effect.The new program will cost the company $200,000 in the first year.