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    FM Class Work 1

    Uploaded by

    Smaran Agarwal

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd

    FM Class Work 1

    Uploaded by

    Smaran Agarwal
    13 views8 pages

    Original Title

    fm class work 1

    Copyright

    © © All Rights Reserved

    Available Formats

    XLSX, PDF, TXT or read online from Scribd

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    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    13 views8 pages

    FM Class Work 1

    Uploaded by

    Smaran Agarwal

    Copyright:

    © All Rights Reserved
    Download as XLSX, PDF, TXT or read online from Scribd
    Download as xlsx, pdf, or txt
    of 8

    rate

    TRUE period
    pmt
    FV/pv

    no true

    pv , single cash flow


    fv gives what pv invested will turn in given rate and time

    4
    annual ren 6000
    15%

    pv ₹ 17,129.87

    NPV

    tuition
    year fees
    1 60000
    2 100000
    3 120000
    4 150000

    rate 8%

    npv ### ₹ 1,762.34


    10%
    5
    20000
    100000

    ₹ 75,815.74 ₹ 75,815.74
    ₹ 62,092.13 ($62,092.13)

    adjusted cash flow


    11000
    12100
    13310
    14641

    ₹ 40,000.00
    cost of the machine 250000
    taxrate 30%

    years 5

    yearss pbdt Dep 50000 pbt


    1 75000 50000 25000
    2 70000 50000 20000
    3 60000 50000 10000
    4 55000 50000 5000
    5 48000 50000 -2000
    tax pat cfat= pat + dep
    7500 17500 67500 ₹ 60,267.86
    6000 14000 64000 ₹ 57,142.86
    3000 7000 57000 ₹ 50,892.86
    1500 3500 53500 ₹ 47,767.86
    -600 -1400 48600 ₹ 43,392.86

    sum ₹ 259,464.29

    npv ₹ 213,436.90
    cost 480,000
    installation 60000
    increase in working cap 120000
    Salvage value at T5 110000
    annual revenue (new) 980000
    cash expenditure 440000
    WDV of old m 140000
    salvage value of old at T0 210000
    Annual revenue(old) 790000
    Life 5
    Dep on old machinery 60000 /yr
    Tax rate 40%
    Dep on new machinery 96% cost in ratio of 5:4:3:2:1
    initial cash flow 540,000

    after dep 518400

    1 year 172800
    2nd yr 138240
    3rd yr 103680
    4th yr 69120
    5th yr 34560
    project a 230000
    project b 250000
    Year Expected Cfats Expected Cfat PV of Cfat A PV of Cfat B
    1 110000 100000 ₹ 94,827.59 ₹ 86,206.90
    2 120000 90000 ₹ 89,179.55 ₹ 66,884.66
    3 100000 100000 ₹ 64,065.77 ₹ 64,065.77
    4 90000 110000 ₹ 49,706.20 ₹ 60,752.02

    Terminal
    flows at
    T4
    40000 30000 ₹ 22,091.64 ₹ 16,568.73
    riskless rat 6%

    rate of
    return
    on risky
    security 10.00% npv ₹ 86,823.62 ₹ 42,192.74
    FV of debt 10000
    CR 8%
    Life 5
    Tax Rate 40%
    RV at 10% prem 11800

    pre and post tax cost of debt

    sol
    yrs cash flows
    0 10000 -10000
    1 -800 800
    2 -800 800
    3 -800 800
    4 -800 800
    5 -11800 11800 KI -cost of debt before tax
    KD - cost of debt after tax
    irr(KI) 9.65% 9.65%
    Kd=KI*(1-t) 5.79%

    FV 5000
    CR 10%
    Issued at prem 10% 5500 net proceeds 5390
    RV at par 5000
    Life 5
    Tax rate 40%
    FC@2% 110
    Years Cash flow
    0 -5390
    1 500
    2 500
    3 500
    4 500 kp 8.04%
    5 5500

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