Scenario Analysis

Supersonic Power Supply Systems, I

Quantities

Sales

Cost of Goods Sold

Expenses
Profits

Worst Case Likely Case

Scenario 1 Scenario 2
HIDDEN COLUMNS
2,564,960
2,974,177
1,707,840

1,501,000

985,600

913,920

###

559,257

Assumptions:
I
Three types of generators, Little Dip, Sweet Cow and Megasaurus---->>>>an
II
Sales Prices are "LIST" prices prior to discount.
III
It is assumed all products will be sold in 2010, but to enable 100% sales, pro
IV
An optional "after sales service" contract @ 10% of cost is available to custom
V
Cost of sales, consists of "List wholesale prices" provided by foreign supplier
VI
Other Expenses will in a best case scenario remain the same, in likely case in

Best Case
Scenario 3
3,379,950
1,294,160
909,600
###

Megasaurus---->>>>and three scenarios, Worst case, Likely Case and Best Case

enable 100% sales, products may have to be discounted

ost is available to customers. Customers may or may not buy (see scenario)
vided by foreign suppliers. Prices could increase or decrease (see scenario)
he same, in likely case increase by 2% and in a worst case scenario by 10%.

Supersonic Power Supply Systems, Inc - Year 2010

Quantities

1,000 Diesel Generators

2,500 Gas Generators
500 Pertoleum Generators
3,000 UPS
200 Wind Power
10 Solar Panels
10% Repair & Maint (Service Contract)
Sales
1,000 Diesel Generators
2,500 Gas Generators
500 Pertoleum Generators
3,000 UPS
200 Wind Power
10 Solar Panels
Cost of Goods Sold
Advertising
NA
Utilities
Salaries
Repair and Maint (within Warranty)
Expenses
Profits

Little Dip

Price Discou
WC
20%
19%
18%
17%
16%
50%
0%

Price Increase or D
15%
14%
13%
12%
11%
10%

Price Increas
10%
10%
10%
10%

Sensitivity Analysis
Sweet Cow
Megasaurus

Price Discount
LC
BC
10%
0%
9%
0%
8%
0%
7%
0%
6%
0%
20%
0%
20%
50%

Price Increase or Discount

0%
15%
0%
14%
0%
13%
0%
12%
0%
11%
0%
10%
Price Increase
2%
2%
2%
2%

0%
0%
0%
0%

Little DipSweet Cow

Megasaurus

Little Dip Sweet Cow

Sales Prices

2KVA
10KVA
HIDDEN COLUMNS
$60
$150
$500
48,000
120,000
$50
$145
$495
101,250 293,625
$40
$140
$490
16,400
57,400
$20
$25
$50
49,800
62,250
$20
$25
$50
3,360
4,200
$1,500 $3,000 $10,000
7,500
15,000
0
0
226,310 552,475
Purchase List Prices
$20
$70
$275
23,000
80,500
$18
$65
$225
51,300
185,250
$16
$65
$225
9,040
36,725
$5
$10
$35
16,800
33,600
$5
$10
$35
1,110
2,220
$300
$1,000 $4,000
3,300
11,000
104,550 349,295
Estimated $ Amounts
$10,000 $50,000 $50,000
11,000
55,000
$12,000 $50,000
###
13,200
55,000
###
###
###
110,000 220,000
$14,000 $20,000 $40,000
15,400
22,000
149,600 352,000
(27,840)

###

sis
Worst Case
Megasaurus
30KVA Scenario 1

Likely Case
Little Dip Sweet CowMegasaurus
2KVA

10KVA

30KVA Scenario 2

Little Dip

2KVA

400,000
568,000
1,002,375 1,397,250
200,900
274,700
124,500
236,550
8,400
15,960
50,000
72,500
0
0
1,786,175 2,564,960

54,000
135,000 450,000
639,000
113,750 329,875 1,126,125 1,569,750
18,400
64,400
225,400
308,200
55,800
69,750
139,500
265,050
3,760
4,700
9,400
17,860
12,000
24,000
80,000
116,000
5,154
12,555
40,609
58,317
262,864 640,280 2,071,034 2,974,177

60,000
125,000
20,000
60,000
4,000
15,000
14,200
298,200

316,250
419,750
641,250
877,800
127,125
172,890
117,600
168,000
7,770
11,100
44,000
58,300
1,253,995 1,707,840

20,000
70,000
275,000
365,000
45,000
162,500 562,500
770,000
8,000
32,500
112,500
153,000
15,000
30,000
105,000
150,000
1,000
2,000
7,000
10,000
3,000
10,000
40,000
53,000
92,000 307,000 1,102,000 1,501,000

17,000
38,700
6,960
13,200
890
2,700
79,450

55,000
165,000
220,000
44,000
484,000

121,000
233,200
550,000
81,400
985,600

10,200
12,240
102,000
14,280
138,720

48,180

###

32,144

51,000
51,000
204,000
20,400
326,400

51,000
153,000
204,000
40,800
448,800

112,200
216,240
510,000
75,480
913,920

11,000
13,200
110,000
15,400
149,600

6,880 520,234 559,257

69,150

Sweet CowMegasaurusBest Case

10KVA

30KVA Scenario 3

150,000 500,000
710,000
362,500 1,237,500 1,725,000
70,000
245,000
335,000
75,000
150,000
285,000
5,000
10,000
19,000
30,000
100,000
145,000
34,625 112,125 160,950
727,125 2,354,625 3,379,950
59,500
233,750
310,250
139,750 483,750
662,200
28,275
97,875
133,110
26,400
92,400
132,000
1,780
6,230
8,900
9,000
36,000
47,700
264,705 950,005 1,294,160
50,000
50,000
200,000
20,000
320,000

50,000
150,000
200,000
40,000
440,000

111,000
213,200
510,000
75,400
909,600

142,420 964,620

###

Quantities

100%

Caterpillar Enterprises is determing whether or not to purchase an

1. Initial Investment in Project $25,000
2. Cost of Capital = 21% - combining Required Rate of Return + Inflation
3. Pretax Operating Cash Flows from Years 1-4 are $10,000 per year

NPV (Inflation Adjusted)

Catepillar Enterprise - Calculation of Net Present Val
Timeline
Description

Year 0
($25,000)

Initial Investment
Real Cash Flows After Tax
Inflation Factor
Nominal Cash flow After Tax
Total After Tax Cash Flows from Operations
PV of $1 at a discount rate of 21% (includes Inflation)
Discounted Cash Flow
Cumulative Discounted Cash Flow showing
($25,000)

Year 1
$10,000
1.10
$11,000
$11,000
0.826
$9,091
$9,091

or not to purchase an Industrial crane. Determine NPV Inflation Adjusted?

urn + Inflation
0 per year
Calculation of Net Present Value on purchase of Crane

Timeline
Year 2
$10,000
1.21
$12,100
$12,100
0.683
$8,264
$17,355

Year 3
$10,000
1.33
$13,310
$13,310
0.565
$7,517
$24,872
NPV

Year 4
$10,000
1.46
$14,641
$14,641
0.467
$6,830
$31,703
$6,703

flation Adjusted?