Financial desicion

Færdiggjort Opslået 2 år siden Betalt ved levering
Færdiggjort Betalt ved levering

I need you to help to find the right financial decision for the below case in regards of the below question.

Case:

Intel Build vs. Buy:

Incremental Cash Flows

Evan Cole continues to contemplate Intel’s decision regarding whether to build part number 11235813 in-house or outsource the production. Cole previously calculated the appropriate discount rate for the project, and now turns his attention to estimating future cash flows. He has the following information, which he has collected from various other managers in the company.

Intel has spent $500,000 designing and testing the part, and the decision to produce and sell the product has already been made. A supplier has bid to produce and deliver the part for $1 per unit, fixed for the life of the contract. Intel could also produce the part internally, but it would require some new investment as follows.

Intel would need to use 20,000 square-feet of its primary production facility. The space is currently unused and Cole knows of no plans to make use of it in the near future. To pay-off the building, Intel charges projects $5 per square foot used per year.

Intel would need to use 5-year old equipment with a current market value of $1 million (it was purchased for $2 million) for the new part. It would also have to buy new equipment worth $3 million. All of Intel’s equipment is depreciated over a 5-year life. Although the new equipment will be fully depreciated, Cole anticipates Intel will be able to sell the new equipment for $200,000 at the end of the 7-year lifetime of this project.

Intel will shift an experienced production manager from an ongoing product to oversee the new part. Even though an experienced production manager costs $90,000, compared to $70,000 for a new one, Intel has found that it is worth it for new processes. The marketing manager for this new line will earn $75,000.

The labor force for production would be hired new at a cost of $200,000. Material cost to produce the units will be $0.50 per unit. All salaries and wages increase at 5% per year and material costs will increase at 3% per year.

Intel expects to have taxable income for the foreseeable future, and estimates its marginal tax rate at 21%.

Intel expects to need 3 million units per year for three years, 2 million the following year, 1 million in year 5 and then 500,000 for years 6 and 7 before closing down production.

Equipment purchases would happen immediately. Production expenses would start in year 1. If the contract is chosen, purchases would begin in year 1.

Cole stares at the information before him. Before he can start building his Excel model, he needs to identify all of the relevant cash flows and any other issues.

Questions:

1.) How would you define the "project"?

2.) What are the incremental cash flows for the project?

3.) What is the NPV of the project assuming a WACC of 7.78%? Should Intel undertake this project?

Finans Finansanalytiker Økonomisk Research Research Writing Finansiel planlægning

Projekt ID: #32208179

Om projektet

39 bud Remote projekt Aktiv 2 år siden

Tildelt til:

charleslimnet

Hello I am a proficient chartered accountant (C.A.) in business and finance analysis. I have 18 years’ experience as a practicing CPA and 20 years’ experience as an academic researcher and analyst. I am passionate abou Flere

$30 USD på 1 dag
(455 bedømmelser)
7.8

39 freelancere byder i gennemsnit $30 timen for dette job

topacademics

I will provide you quality research writing. I am a PhD writer with 10 years of experience. I have worked on several similar projects of research writing, and can deliver professional research writing to tight deadline Flere

$12 USD på 1 dag
(1237 bedømmelser)
8.8
topacademictutor

Financial desicion I have 13 years of experience in the Writing Industry and I can provide you with “SUPREME QUALITY WORK” within your “GIVEN DEADLINE” with “PERFECT GRAMMAR” and “ZERO PLAGIARISM”. I have 1500 "EXCEL Flere

$10 USD på 1 dag
(1176 bedømmelser)
8.1
zohaab85

Hi! I can assist you by providing optimum quality tasks as per your requirements. With over 600 satisfied clients, I am working as a professional writer for over a decade. I am SPECIALISED in 200+ SUBJECT AREAS and ca Flere

$120 USD in 4 dage
(316 bedømmelser)
8.0
moizdzo3l

Hello, Being an MBA Finance graduate from Harvard University I assure you that I will handle this task and assist you with the task, I am a professional academic writer I have experience 6 years of working on projects Flere

$100 USD in 2 dage
(163 bedømmelser)
7.5
arwamoizds

Hi I am an experienced research writer, I have written technical reports, research papers, thesis, literature reviews, essays etc. I always deliver high-quality projects that are 100% original, free from plagiarism, i Flere

$50 USD in 2 dage
(156 bedømmelser)
7.1
EmmaWat

Hi, I am a professional Accountant having CPA and MBA qualifications. I have over 15 years professional experience in the field of Accounts/ Finance. My experience consists of Maintaining and Finalisation of Accounts, Flere

$75 USD på 1 dag
(114 bedømmelser)
7.1
ShaikhAneesa

Greetings! I am a MBA in Finance and Accounting, currently doing my CFA-1, and a professional research paper writer for banking sector, with over 10 years of experience. I have got an immense knowledge and background i Flere

$50 USD in 7 dage
(102 bedømmelser)
6.7
DivineSolutions1

Hello, I’m a professional business content writer having 8 years of experience. In these 8 years, I have written hundreds of Business financial analytics, proposals, business plans, analytics, etc. for different compa Flere

$25 USD in 7 dage
(26 bedømmelser)
6.0
HelpingHut

Financial desicion After reading your project details, I feel, I am the best option for you to fulfill this project with 100% perfection. I am working in this industry since 2014 and I have served more than 1200 clie Flere

$10 USD på 1 dag
(183 bedømmelser)
6.0
IdealExpert

Financial desicion This project is my strength and I can fulfill your requirements properly within your given deadline. I always give plagiarism-free work to my clients at very competitive prices. I have more tha Flere

$10 USD på 1 dag
(145 bedømmelser)
5.8
Stopsolution

Financial desicion I am a professional MBA writer with more than 7 years of experience in every field of writing. I did thousands of projects with 100% accuracy and on requirements, My promises included; best efforts, Flere

$10 USD på 1 dag
(138 bedømmelser)
5.8
Naumanahmed11

Greetings Sir ! I am CMA professional and member of recognized body of professional accountants. My core expertise are in cost accounting, financial accounting , corporate financial reporting and financial management. Flere

$30 USD på 1 dag
(19 bedømmelser)
5.4
Maclavin

looking for financial analyst? Hello, i am an experienced content writer, i assure you of high-quality work, plagiarism free, instructions followed and on-time delivery. i am interested to hear more about the project, Flere

$25 USD in 7 dage
(95 bedømmelser)
5.9
penslingers06

Financial desicion Being MBA and having a professional experience of 7 years in different types of writing services, I can better assist you with my budget friendly, plagiarism free, well researched, premium quality wr Flere

$30 USD på 1 dag
(89 bedømmelser)
5.3
Godfreyvictor

Hello, Top of the day. Trust you are doing great. I will like to work with you on your project. I am a Professional Accountant, Researcher and Writer with wealth of experience in report writing, academic writing, fi Flere

$50 USD in 2 dage
(45 bedømmelser)
5.4
FineIdeas

Financial desicion Since 2012, almost from 8 years I am managing academic writing tasks successfully. I am working with my friends from different backgrounds, it means I can manage wide range of projects like; Engine Flere

$10 USD på 1 dag
(63 bedømmelser)
5.0
Goodfreelancer1

Hello, I am an expert in Finance. I can help you in your project. I have completed these projects. Please have a look: https://www.freelancer.com/projects/finance/Solution-finance-case-study/reviews [login to view URL] Flere

$50 USD på 1 dag
(31 bedømmelser)
5.2
ExpertsPen

"Top Rated ✓ ᵛᵉʳᶦᶠᶦᵉᵈ® Freelancer Writer"  I have more than 6-7 years of experience in research writing, essays, dissertation & Thesis, Article writing, etc. It means you don't need to look anywhere else because I am t Flere

$10 USD på 1 dag
(61 bedømmelser)
4.8
InnovationExpert

Financial desicion Hi... It's Zeeshan here :-) I have read your project details and I can provide you QUALITY WORK within your given timeline and budget. I am very much sure that I can fulfill your expectations ev Flere

$10 USD på 1 dag
(46 bedømmelser)
4.8
SolutionMart

Financial desicion I am a supreme writer who has full command over Academic Writing including; SWOT, PESTEL, Porter Five Forces Analysis, 7Ps, summaries, Case Studies, Dissertations/Thesis and Report Writing Projects Flere

$10 USD på 1 dag
(33 bedømmelser)
4.5