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Financial Analyst Challenger Ltd 金融会计assignment代写

Financial Analyst Challenger Ltd 金融会计assignment代写.

Financial Analyst Challenger Ltd 金融会计assignment代写
  NA INDIVIDUAL ASSIGNMENTDUE DATE: Submission 17 Jul 2018 –11:59PMWEIGHTING – 40 marks, weight 20%You are a Financial Analyst with Challenger Ltd and the chief financial officer (CFO) requests youto evaluate two new capital budgeting proposals. Specifically, you are asked to provide arecommendation and also respond to a number of questions aimed at assessing your level ofcompetence in capital budgeting process.Instructions are as follows:Provide an evaluation of two proposed projects, both with identical initial outlays of $200,000.Both of these projects involve additions to a client’s highly successful product line. The requiredrate of return on both projects is set at 11%. The expected after-tax cash flows from eachproject are as presented in the table below.PROJECT X  PROJECT YInitial outlay  -$400,000  -$400,000Inflow year 1  $80,000  $160,000Inflow year 2  $140,000  $160,000Inflow year 3  $130,000  $160,000Inflow year 4  $160,000  $160,000Inflow year 5  $160,000Inflow year 6  $160,000
Financial Analyst Challenger Ltd 金融会计assignment代写
 In evaluating these projects, please respond to the following questions:1. Offer your insight on what discount rate means? (5 marks)2. What is the payback period on each project? If Challenger Ltd imposes a 2.5-year maximumacceptable payback period, which of these projects should be accepted? (7 marks)3. What are the main limitations of the pay back method of valuation. Despite these limitations, thepay back method, most chief financial officers (CFOs) use it. Explain why. (5 marks)4. Determine the NPV for each of these projects? Should the projects be accepted? Explain. (5marks)5. Determine the IRR for each of these projects? Should the projects be accepted? Explain. (3 marks)6. Under what circumstances will the NPV and IRR offer different prescriptions? (3 marks)7. How would you accommodate unequal lives of the project while determining the NPVs of theproject? Demonstrate using calculations. (3 marks)8. Explain why unequal lives of projects make NPVs of the projects incomparable. (3 marks)9. Determine the profitability index for each of these projects? Should the projects be accepted?Explain. (4 marks)10. Clarity of Presentation (2 mark)Word Limit – About 1200 words – tables and calculations not included in the word limit.END OF ASSIGNMENT.
Financial Analyst Challenger Ltd 金融会计assignment代写

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Financial Analyst Challenger Ltd 金融会计assignment代写

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