Capital Budgeting Worksheet Essay

Read the scenarios below and select one to look backward and analyze. Determine the proposals appropriateness and stinting viability. For all scenarios, seize 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 capital is 10%. Ignore taxes and depreciation. marriage proposal A New FactoryA ships follow wants to build a novel factory for increased capacity. Using the net present range (NPV) method of capital budgeting, visualize the proposals appropriateness and economic viability with the following informationBuilding a natural factory leave increase capacity by 30%.The current capacity is $10 gazillion of sales with a 5% profit margin.The factory be $10 million to build.The new capacity pass on meet the companys needs for 10 years.The factory is worth $14 million over 10 years.Proposal B New EquipmentA company wants to buy a labor-saving piece of equipment. Using the NPV method of capital budgeting, determine the proposals appropriateness and economic viability with the following information drive content is 12% of sales, which are annually $10 million.The new equipment go forth save 20% of labor annually.The new equipment allow for last 5 years.The new equipment will cost $200,000.Proposal C New advertising ProgramA company wants to invest in a new advertising course of instruction. 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.