case 14 restore incorporation (usman nasir) (mba 123997)

7/23/2019 Case 14 Restore Incorporation (USMAN NASIR) (MBA 123997)

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S.No Year Revenue Earning After Tax

1 1996 6000 440

2 1997 6900 464

3 1998 7866 538

4 1999 8445 652

Compound Growth Rate 8.92% 10.33%

USMAN N


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SIR (MBA 123997)


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a). Salvage Value

Probability Estimate Value

0.3 5000 1500

0.2 7000 1400

0.5 6500 3250

Salvage value 6150

b). New Mac!"e a""ual #e$%ec!a&!'"'& '* Au&'+a&e% 60000

(,)Salvage value 6150

Re+a!"!"g 53-50

A""ual e$%ec!a&!'" 6731.25

c). /l Mac!"e a""ula #e$%ec!a&!'"

/l Mac!"e 24000

A""aul #e$. 2400


5/11

a av!"g *%'+ #e$%ec!a&!'"

ea% 1 2 3 4 5 6

New Mac!"e 6731.25 6731.25 6731.25 6731.25 6731.25 6731.25

/l Mac!"e 2400 2400 2400 2400 2400 2400

#!**e%e"ce !" #e$. 4331.25 4331.25 4331.25 4331.25 4331.25 4331.25

a Ra&e 30 30 30 30 30 30

a av!"g 1299.375 1299.375 1299.375 1299.375 1299.375 1299.375

New +ac!"e a""ula #e$%ec!a&!'"

0 60000 Sale of old machine

1 6731.25 53268.75 cost 15000

2 6731.25 46537.50 Tax 30%

3 6731.25 39806.25

4 6731.25 33075.00 Sale 10500

5 6731.25 26343.75

6 6731.25 19612.50

7 6731.25 12881.258 6731.25 6150.00

Remaining al!e 6150.00

"et Sal#age 4305.00

USMAN NASIR


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7 - $ea 0 1

6731.25 6731.25 &!chase of '!tomaste ( )60000

2400 2400 Sale of *ld +achine 10500

4331.25 4331.25 Tax Sa#ings 1299.375

30 30 "et Sal#age

1299.375 1299.375 "et ,o-ing a/ital )2000"et */eating (ncome 8400

"et asho )51500 9699.375

Rate "&

0% 32400.00

1% 28539.05

2% 24933.85

3% 21563.85

4% 18410.42

5% 15456.606% 12686.95

7% 10087.43

8 !"#$.%&

9% 5348.55

10% 3186.78

11% 1150.08

12% )770.52

13% )2583.24

14% )4295.64

15% )5914.67

16% )7446.70

MBA 123997)


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Cashows

2 3 4 5 6 7 -

1299.375 1299.375 1299.375 1299.375 1299.375 1299.375 1299.375

4305

20008400 8400 8400 8400 8400 8400 8400

9699.375 9699.375 9699.375 9699.375 9699.375 9699.375 16004.38

(RR

''.$(%

0 1 2 3 4 5 6 7 - 9 10 11 12 13 14

,10000

,5000

0

5000

10000

15000

20000

2500030000

35000

NPV Profile


8/11

15 16


9/11

.1

.4

.5

.6

.7

.-

.9

.10


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AS R8R / :/R# #/UMN AA#

e; &e NV a& - c'& '* ca$!&al ! 7645 a" IRR ! 11.592. u; %e$lace+e"& w!ll %eul& !" ec'"'+!c be"e*!&.

e

Acc'"g &' e&!cal %e$'"!b!l!&< a" c'++!&e+e"&; &e< 'ul "'& %euce &e w'%=*'%ce.



e; g!ve" &e bala"ce ee& c'+$'!&!'" '* &e c'+$a"< a" $%'>ec& %ev!e"ue; a" u"*'%eee" 'b'lece"e w!ll !g"!*!

Al&'ug &e $%'bab!l!&< e&!+a&e '* "ew +ac!"e ee+ %ea'"able (&e alvage value ! e?ual &' &e e&!+a&e) bu& &!"e$e"e"& ae+e"& %a&e% &a" +a"u*ac&u%e% !"v'l've+e"&

USMAN NASIR (MB


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case 14 restore incorporation (usman nasir) (mba 123997)

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