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Hello, Pls help me in solveing the problem mentioned below: Ram & Co is considering investment costing rs 450 lacs. This is financed by loan of Rs. 300 lacs on which interest @ 15 % is payable. The estimated useful life is 5 years. The project involves plant costiing Rs 200 lacs & working capital is Rs 250 lacs. The plant is subjected to be depreciated @ 15 % p a fixed installment method. At the end of project life, plant will realise 25% of cost & Working capital will realise 90% of cost. The loan will be repaid. The PBD& T is estimated & PV factor @ 10 % & 16% are as follows: year PBDIT PV Factor 10% 16% 1 125 0.909 0.862 2 150 0.826 0.743 3 175 0.751 0.641 4 195 0.683 0.552 5 160 0.621 0.476 Income tax applicable @ 35 % You are required to calculate 1 Payback period 2 ARR on total investment 3 NPV @ 10 % & 16% 4 IRR

Hello, Pls help me in solveing the problem mentioned below:


Ram & Co is considering investment costing rs 450 lacs. This is financed by loan of Rs. 300 lacs on which  interest @ 15 % is payable. The estimated useful life is 5 years. The project involves plant costiing Rs 200 lacs & working capital is Rs 250 lacs. The plant is subjected to be depreciated @ 15 % p a fixed installment method. At the end of project life, plant will realise 25% of cost & Working capital will realise 90% of cost. The loan will be repaid. The PBD& T is estimated  & PV factor @ 10 % & 16% are as follows:


year          PBDIT              PV Factor


                                      10%           16%


1               125                0.909         0.862


2               150                 0.826        0.743


3               175                 0.751         0.641


4               195                 0.683         0.552


5               160                 0.621         0.476


 


Income tax applicable @ 35 % You are required to calculate


1 Payback period


2 ARR on total investment


3 NPV @ 10 % & 16%


4 IRR

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