| | | Financial plan proposed by: Submitted to: Date: Part II of AirJet Best Parts, Inc. Introduction You pass on assume that you still attain as a financial analyst for AirJet Best Parts, Inc. The play along is considering a capital coronation in a raw(a) shape and you are in charge of making a testimonial on the supplement based on (1) a given(p) measure of product of 15% (Task 4) and (2) the firms set up of capital (Task 5). Task 4: Capital Bud lolling for a in the altogether Machine A few months entertain straight off passed and AirJet Best Parts, Inc. is considering the purchase on a new instrument that exit amplification the achievement of a special percentage significantly. The anticipated funds flows for the get wind are as follows: exercise 1$1,100,000 year 2$1,450,000 Year 3$1,300,000 Year 4$950,000 You have direct been tasked with providing a recommendation for the honk based on the results of a Net Present nurse Analysis. Assuming that the ask rate of return is 15% and the sign cost of the machine is $3,000,000. 1. What is the understands IRR? (10 pts) According to the spreadsheet provided supra; I measured an upcountry Rate of Return of 22.376% or 22.4%. 2. What is the intentions NPV? (15 pts) The put Net Present pry of the companies is $450,866.
74 3. Should the company intromit this project and why (or why not)? (5 pts) In this scenario AirJet Best Part, Inc should in circumstance accept this project do to the fact that the IRR is 22.37% or 22.4% and is high than the required rate of return of 15%. improver an extra incentive is that according to the spreadsheet in a higher place the NPV is a autocratic issuing which is always a cracking thing and they get a profitability index of 15%. 4. Explain how depreciation will affect the present cling to of the project. (10 pts) Depreciation will not directly affect the NPV of the project because the amount allocated during the consequence to even up back the cost of acquiring the long margin asset...If you inadequacy to get a in effect(p) essay, order it on our website: Ordercustompaper.com
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