Ejercicio Finanzas

ASSIGNMENT OF FINANCIAL MANAGEMENT NAGEMENT
Department of Finance and Operations Management University of Seville.

PRACTICE 8
A group of friends are going to start up a CAR WASH. They need tobuy land valued at 35.000 E .000 Euros, buildings valued at 30.000 Euros (straight line depreciation in 20 years), equipments valued at 40.000 Euros(straight line depreciation in (straight 10 years),and will need working capital (NCA) at ? (CALCULATE)

The Car Wash´s revenues (sales) will be of 168,000 Euros the first year with an increment of 20% every year (from previous year). The annual costsof services sold (constant every year) are the following: inventories for 34.000 Euros, following: personnel expenses for 50,000 Euros and general expenses for 60,000 Euros. The average period willbe of 20 days. eriod % The land and buildings will be financed with equity with a dividend policy of 15% over the nominal price of shares and the rest with a long term loan at 10 % interest, to be paidin five repayments starting from the second year. At the end of the third year they have to liquidate the company. The selling price of the land is € 40,000 and € 30,000 t buildings, Equipments at30,000 and working capital (NCA) at 8,000. Tax rate of 30%; Furthermore, the accounting income is equal to cash flow. We want to know: 0%; 1. Amount of Investment or Capital investment: A 2. IncomeStatement 3. Operating Cash Flows: CFat 4. Residual Value: RVat 5. Time-Line Representation of investment Line investment. 6. Time –Line Representation of the Loan after Tax Line 7. Time-LineRepresentation of the Equity Line 8. Time-Line Representation of total Financing inancing 9. The weighted average cost of capital or WACC. ital 10. Net Present Value (NPV). Using the Cash flows at 11. Financialfeasibility of the investment/financing project. e 12. Represent the formula to calculate the IRR of the Investment 13. Represent the formula to calculate the IRR of the Financing 14. If the IRR of...