WACC CF1 CF2 CF3 CF4 CF5 Initial Outlay ($65,000,000) Cash Flows (Sales) $50,000,000 $25,500,000 $65,500,000 $45,000,000 $55,000,000 $25,000,000 $25,500,000 $25,500,000 $25,500.000 $25,500,000...


What is the difference between NPV and IRR?  Which one would you choose for evaluating a potential investment and why? Be sure to support reasoning with evidence for each capital budgeting metric (i.e., the NPV and IRR).


WACC<br>CF1<br>CF2<br>CF3<br>CF4<br>CF5<br>Initial Outlay<br>($65,000,000)<br>Cash Flows (Sales)<br>$50,000,000<br>$25,500,000<br>$65,500,000<br>$45,000,000<br>$55,000,000<br>$25,000,000<br>$25,500,000<br>$25,500,000<br>$25,500.000<br>$25,500,000<br>Operating Costs (excluding Depreciation)<br>(13,000,000)<br>(13,500,000)<br>(3,375,000)<br>(10,125,000)<br>Depreciation Rate of 20%<br>Operating Income (EBIT)<br>Income Tax (Rate 25%)<br>After-Tax EBIT<br>(13,000,000)<br>27,000,000<br>6,750,000<br>20,250,000<br>(13,000.000)<br>(13,000,000)<br>(13,000,000)<br>16,500.000<br>11,500,000<br>6.500,000<br>4,125,000<br>12,375,000<br>2,875,000<br>8,625,000<br>1,625,000<br>4,875,000<br>+ Depreciation<br>Cash Flows<br>13,000,000<br>13,000,000<br>13,000,000<br>13,000,000<br>13,000,000<br>17,875,000<br>($65,000,000)<br>25,375,000<br>2,875,000<br>21,625,000<br>33.250,000<br>Select from drop<br>down below:<br>$15,404,422.60 ACCEPT<br>NPV<br>IRR<br>19% ACCEPT<br>

Extracted text: WACC CF1 CF2 CF3 CF4 CF5 Initial Outlay ($65,000,000) Cash Flows (Sales) $50,000,000 $25,500,000 $65,500,000 $45,000,000 $55,000,000 $25,000,000 $25,500,000 $25,500,000 $25,500.000 $25,500,000 Operating Costs (excluding Depreciation) (13,000,000) (13,500,000) (3,375,000) (10,125,000) Depreciation Rate of 20% Operating Income (EBIT) Income Tax (Rate 25%) After-Tax EBIT (13,000,000) 27,000,000 6,750,000 20,250,000 (13,000.000) (13,000,000) (13,000,000) 16,500.000 11,500,000 6.500,000 4,125,000 12,375,000 2,875,000 8,625,000 1,625,000 4,875,000 + Depreciation Cash Flows 13,000,000 13,000,000 13,000,000 13,000,000 13,000,000 17,875,000 ($65,000,000) 25,375,000 2,875,000 21,625,000 33.250,000 Select from drop down below: $15,404,422.60 ACCEPT NPV IRR 19% ACCEPT

Jun 05, 2022
SOLUTION.PDF

Get Answer To This Question

Related Questions & Answers

More Questions »

Submit New Assignment

Copy and Paste Your Assignment Here