FIN 301 Salem State University ABC Corporation Capital Budgeting Memo Need to write and analyse capital budgeting. calculating IRR , PI and NPVWriting a me

FIN 301 Salem State University ABC Corporation Capital Budgeting Memo Need to write and analyse capital budgeting. calculating IRR , PI and NPVWriting a memo FIN 301 – Capital Budgeting Assignment
EXCEL PART: Submission format: Excel File
ABC Corporation has a machine that requires repairs or should be replaced.
ABC has evaluated the two options and calculated the cash flows resulting
from each option as follows:
Option A: Repair the Machine
Year
Cash Flow
0 $70.500,00
1 $18.500,00
2 $35.100,00
3 $18.500,00
4 $17.800,00
5 $12.700,00
Option B: Buy a new Machine
Year
Cash Flow
0 $375.500,00
1 $55.300,00
2 $133.000,00
3 $123.800,00
4 $128.900,00
5 $124.100,00
– Capital Budgeting Assignment
WRITING PART: Submission format: Word Document
You have recently been hired by ABC corporation and your first assignment is to help
them decide which of these two options should be pursued. You would like to apply the
capital budgeting and Time Value of Money concepts you have learnt in FIN 301 to
analyze the solution and present it to your boss in three days.
Conduct the analysis and calculate Payback period for each option, IRR of each option and
PI and NPV for each option at three WACC points of 10%, 12%, 14%, and 16%
Write a memo to your boss, explaining the results of your analysis, your decision
and include a table and a chart showing your analysis.
Note: WACC is the discount rate

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