Fifth edition Alnoor Bhimani Charles T. Horngren Srikant M. Datar Madhav V. Rajan Farah Ahamed



Download 1.72 Mb.
View original pdf
Page279/469
Date01.12.2021
Size1.72 Mb.
#57828
1   ...   275   276   277   278   279   280   281   282   ...   469
solutions-manual-to-bhimani-et-al-management-and-cost-accounting-pearson-2012-1
Total
present
value
(in millions)
Present
value
of NKr 1
discounted at
12%



Sketch of relevant cash flows





End of year
Year 1 (start) Year 1 (end) Year 2 (end) Year 3 (end) Year 4 (end. Initial signing bonus
NKr(3.0000)
←−−
1.000
←−−
NKr(3.0)
2. Recurring operating cash flows
0.0893
←−−
0.893
←−−−−−−−−−
NKr0.1

1.6737
←−−
0.797
←−−−−−−−−−−−−−−−−
NKr2.1

1.2816
←−−
0.712
←−−−−−−−−−−−−−−−−−−−−−−
NKr1.8

1.1448
←−−
0.636
←−−−−−−−−−−−−−−−−−−−−−−−−−−−
NKr1.8
Net present value
NKr 1.1894


Bhimani, Horngren, Datar and Rajan, Management and Cost Accounting, 5
th
Edition, Instructor’s Manual
© Pearson Education Limited 2012
1b
Payback period


Year

Net cash
inflows

Cumulative net
cash inflows
Cash investment yet
to be recovered
at end of year
0: Year 1 (start)


NKr3.000 1: Year 1 (end)
NKr0.100
NKr0.100 2.900 2: Year 2 (end)
2.100 2.200 0.800 3: Year 3 (end)
1.800 4.000

4: Year 4 (end)
1.800 5.800
– Payback period = 2 years +
NKr 0.800
NKr1.800






= 2.44 years
2
Other factors Aspelund might consider include
a
Uncertainty over the predicted cash inflows for 2012 to 2015. A key factor here is the possible risk of injury to Monteiro or a diminishing of his soccer ability.
b
Increase in number of championships Aalesund Fotballklubb wins.
c
Increase in community pride that accompanies a championship team.
d
Aspelund's own personal prestige of being president of a championship club.
e
The effect the signing would have on Aalesund Fotballklubb’s ability to sign other players.

Download 1.72 Mb.

Share with your friends:
1   ...   275   276   277   278   279   280   281   282   ...   469




The database is protected by copyright ©ininet.org 2024
send message

    Main page