Option NPV of the Cash Flows Initial Investment Year 1 Year 2 Year 3 Year...
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Accounting
Option
NPV of the Cash Flows
Initial Investment
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
A
Project A: 25 Employee Facility
-2,000
-200
-300
-400
200
400
1,000
1,000
1,000
1,000
1,000
B
Project B: 40 Employee Facility
-2,500
-200
-200
100
400
400
1,500
1,500
1,500
1,500
1,500
C
Project C: 75 Employee Facility
-3,000
-300
-400
-100
600
700
2,000
2,000
2,000
2,000
2,000
D
Equipment 1- Fully Automatic
-1,500
-100
100
200
400
200
800
800
800
800
800
E
Equipment 1- Semi Automatic
-1,000
-50
-100
200
200
300
600
600
600
600
600
F
Equipment 1- Manual
-750
150
150
150
150
150
750
750
750
750
750
G
Equipment 2- Standard
-800
-175
200
250
250
300
700
700
700
700
700
H
Equipment 2- Top of the Line
-1,500
-100
275
325
325
325
1,500
1,500
1,500
1,500
1,500
I
Equipment 3- 3-Man Machine
-700
-200
-150
250
350
350
J
Equipment 3- 2-Man Machine
-600
-175
-100
175
175
175
K
Equipment - 5-Man Machine
-750
-300
-200
300
400
400
Construct and recommend between three and five metrics to measure the performance of the new operating strategy. At least one metric should reflect dividend policy as it relates to rewarding shareholders.
Prepare an executive summary describing your recommendations for each project and the overall cost, net cash flows, and expected returns of the operating configuration that you recommend. Be sure to justify your recommendations in terms of the investment criteria applied in Step 3 above. Be sure to report the full cost of the facility as it is configured per your recommendations. Present and justify your operating strategy performance metrics.
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