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Module 4 Assignment Executive Summary

Executive Summary

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Daniel Obadaye
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34 views

Module 4 Assignment Executive Summary

Executive Summary

Uploaded by

Daniel Obadaye
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Danthel Victuals Seafood

Executive Summary
Danthel Vituals is a fishing company offering quality seafoods to the food and beverage
company.
The Problem

The company has intended to procure another sets of fishing gears which is expected to add
value and return on investment over the next 7 years. In order to effectively analyse the
potential project, it is imperative to utilize various financial tools to assess its viability. Once
the analysis is complete, it is then necessary to present the findings to the executive
leadership team in a clear and concise manner. This will allow for informed decision-making
and strategic planning moving forward.
The Solution
Based on the analysis, there is positive outcome in making the investment.
Present Value
Present Value Percentage Year Cash Flow (Future Value)
$300,000.00 0.07 0 -$300,000
-$23,364.49 0.07 1 $25,000
-$43,671.94 0.07 2 $50,000
-$28,570.43 0.07 3 $35,000
-$91,547.43 0.07 4 $120,000
-$92,688.20 0.07 5 $130,000
$16,658.56 0.07 6 -$25,000
-$68,502.47 0.07 7 $110,000

Total
Future Value
Present Value Percentage Year Cash Flow (Future Value)
-$23,364.49 0.07 1 $25,000
-$43,671.94 0.07 2 $50,000
-$28,570.43 0.07 3 $35,000

Highlights
The concept of Internal Rate of Return (IRR) at 10 percent is a crucial tool in project
evaluation. IRR represents the discount rate at which the net present value of cash flows from
a project equals zero. In other words, it signifies the rate of return that an investment is
expected to generate.
Recommendation
The alternative investment has a potential to make a 10 percent Internal Rate of Return.
When evaluating projects, a 10 percent IRR indicates that the project is expected to yield a
return of 10 percent, meaning it is considered as a favorable investment opportunity. If the
IRR exceeds 10 percent, then the project is deemed to be more lucrative than alternative
investments with lower rates of return.

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