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QUESTION

Hello, i need to know (changes in Networking capital), i have supplied the below information; Life of the project = 5 years initial investment =

Hello,

i need to know (changes in Networking capital), i have supplied the below information;

Life of the project = 5 years

initial investment = 100,000,000

Number of units produced each year is;

0

1 = 2000

2 = 3000

3 = 5000

4 = 4000

5 = 3000

Cost per unit per year is;

0 =

1 = $63,000

2 = $50,000

3 = $69,000

4 = $85,000

5 = $72,000

Variable Costs per unit per year -$                 30,000

Fixed Cost (incl Marketing) - $           10,000,000

Rent foregone - $     1,200,000

salvage Value $        15,000,000

Depreciation (10%) - $           20,000,000

Tax rate: 30%

Please show how to work Changes in NWC,

thank you for assistance

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