Assignment 1 Brief: Hill's (Part 1)

Project X
000
Cum C/f
T
T
T
T
T
T

-165
-85
5

0
1
2
3
4
5

NetCapital d/f (10%)

(200)
1
35
0.909
80
0.826
90
0.751
75
0.683
20
0.621
300

Payback
2+(85/90 * 12)
2 Year and 11 Months

NPV=>

NPV:10%
(200)
31.82
66.08
67.59
51.23
12.42
229.13
229.13
(200)
29.13

d/f (20%) NPV:20%

1
(200)
0.833
29.155
0.694
55.52
0.579
52.11
0.482
36.15
0.402
8.04
180.975
180.98
(200)
-19.025

IRR Function = 16%

d/f(20%)
d/f(10%)
Diff d./f 10%
Diff
1%
IRR

ARR
Total Op Cash In=
Less Total Dep =
Total Profit
=

300
(200)
100

20% 20% -

19.025/4.8155 Avge Profit

3.95
16%
Avge Investment

100/5
20
200

10% +
10%

29.13/4.8155
6
16%

20/200
0.1

IRR
IRR

NPV
(19.025)
29.13
48.155
4.8155

IRR

ARR
ARR

Project Y
000
Cum C/f
18

T
T
T
T
T
T

0
1
2
3
4
5

NetCapital
-200
218
10
10
4
3
245

d/f (10%)
1
0.909
0.826
0.751
0.683
0.621

NPV=>

NPV:10%
(200)
198.162
8.26
7.51
2.732
1.863
218.527
218.53
(200)
18.527

d/f (20%) NPV:20%

1
(200)
0.833
181.594
0.694
6.94
0.579
5.79
0.482
1.928
0.402
1.206
197.458
197.46
(200)
(2.542)

IRR Function = 18%

Payback
200/218 * 12
11 Months
P/B
IRR
NPV
ARR

d/f(20%)
d/f(10%)
Diff d./f 10%
Diff
1%
IRR

IRR

ARR
Total Op Cash In=
Less Total Dep =
Total Profit
=

245
(200)
45

20% 20% -

2.542/2.1069 Avge Profit

1.2
18%
Avge Investment

45/5
9
200

10% +
10%

18.527/2.1069
8.70
18%

9/200
0.045

IRR
IRR

NPV
(2.542)
18.527
21.069
2.1069

ARR
ARR

SUMMARY
Project X
Project Y Preference
Reasons
2Year&11month
1Year
Y
Project Y is Shorter P/B
16%
18%
Y
Higher IRR; Should be> Cost of Capital/Discount rate
29.13
18.527
X
Both Positive But X higher then Y
0.1
0.045
X
Project 'X ' ARR is higher then Project 'Y'
Overall Choice Y: All indicators favour Y except NPV, which is higher then Y

Assignment 1 Brief Hill's & Co part 2

Cash Budget for 6 months
Januar to June 20X5
Task 2 :

Opening Cash Balance

Receipts:
Sales 40% Cash
60% in two Month
Total Cash Available
Payments:
Purchases
75% Wages Current
25% Following Month
Overhead
Debt Interest
Capital Expenditure
Total Payments
Net Cash Flow
Add Bank Balance
Bank Balance overdraft

January
000
15000

February
000

March
000

Aprial
000

44
48
107,000

52
60
112,000

56
66
122,000

60
78
138,000

60
12
3
10

80
15
4
15

90
18
5
15
20
30
178
-56
20
-36

110
21
6
15

85
22
--22

114
-2
22
20

152
-14
-36
-50

May
000

June
000

64
72
84
90
148,000 162,000
130
24
7
20

140
27
8
20

181
-33
-50
-83

40
235
-73
-83
-156

As you can see, cash expenses for Purchases, Wages and Overhead and Debt Interest and Capital
Expenditure exceded the budgeted amounts for the Brief Hill's . The Company analyzes these
figures monthly, changes can be made before the increased expenses become unmanageable.
A medium sized business owners should pay close attention to their cash position and create a cash
budget for their company. Preparing a monthly budget versus actual report will give medium
business owners the information they need to make important decisions about the cash position
of their company.

Assignment 1 Brief: Hill's (Part 3)

1,000

2,000

3,000

44
112
240
396

44
112
240
396

44
112
240
396

200
150

400
300

600
450

425
297.5
1468.5
440.55
1,909.05

850
595
2541
762.3
3,303.30

1275
892.5
3613.5
1084.05
4,697.55

Cost Per Copies

1,909.05
1000

3303.3
2000

4,697.55
3000

Cost Per Copies

1.90905

1.65165

1.56585

Direct Labour:
Setting up the Printing Machine:
Artwork:
Typestting:

(4 hours @ 11 per hours)

(8 hours @ 14 per hours)
(15 hours @ 16 per hours)
Total Direct Labour

Driect Material:
Paper
(for 1000,2000,3000 copyes)
Other Printing Consumables
(for 1000,2000,3000 copyes)
Overhead (Based on Direct Labour)
Direct Labour
(for 1000,2000,3000 copyes)
25,50,75 hours @ 17 per hour
Overhead (70% of direct labour)
Total Cost
Profit
(30% on Cost Price)
Total Price

The cost of 1 Thousand Copies are higher then 3 Thousands because the direct labour
are remain the same and fixed no matter how much you increase the rate of order.