This is the instruction for the project for me and my group i just have to follow the instruction and answer one question this is the instruction and i’ll send the question by email.
Intermediate Financial Management
Advanced Capital Budgeting Applications
Group Project # 1
There are six capital budgeting exercises in this assignment. Please read the below information, some designed to clarify the exercises.
1. All the exercises require that NPV, IRR, and MIRR calculations be checked on EXCEL. If you elect not to utilize EXCEL and there are careless mistakes, you will lose credit.
2. Each problem counts an equal weight, 17% each.
3. Your answers are to be typed and you need to summarize your answers in the first section of your paper. Details on the calculations and the work are to be included as an appendix. This summary of your answers is required.
4. In exercise 5 and 6 ask you to first determine the relevant cash flows.
5. In exercise 6, to estimate the relevant cash flows, use the below, note that FCF=Free Cash Flow. Note that the formula (13-1) is correct, but there is a better version of this formula that I am listing below:
FCFt= EBITt (1 ? T) + Depreciationt ? Change in net operating work capitalt
In addition, since this is evaluating the introduction of a new product, it is not a ?FCF since there is no product it is replacing. Use the above formula to calculate the FCFt: (not sure if you will need this # 5 bullet as it meant to be for exercise # 6, I just typed it incase if the formula will be needed).
6. This project is due Saturday, February 18, 2012 at or before 12:00 PM.
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