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need some help putting together an amortization schedule for a homework
question I had, any help would be appreciated.
Assignment: Based on the information provided below, compute the Net Present Value of the project (CO 3). A Net Present Value Template is Attached. (Hint: Don’t forget to update the discount rate to the amount required for this project and add your cash flow numbers.)
Royal Dutch Shipping is planning on Investing $1,600,000 to buy a freighter. Prepare a net present value analysis based on the assumption that the freighter will be sold for 10% of its cost at the end of the year 5. Assume a 10% cost of capital. Annual operating cash flows for the project are:
Year 1: $380,000
Year 2: $390,000
Year 3: $400,000
Year 4: $410,000
Year 5: $420,000
Prepare a loan amortization schedule based on monthly payments for the $1,600,000 if Royal Dutch Shipping can pay 10% down on a loan for $1,600,000 and can get a loan for 6% interest for 10 years (do not include this in your Net Present Value computations. This is a separate issue. (CO 3). (Hint:www.bankrate.com/calculators/mortgages/amortization-calculator.aspx )
Instructions: Prepare the homework in Excel template provided.
Here is the feedback from my professor so I guess that some of the answers are wrong in the excel sheet as well.
Information also needs to go through turnitin without any problems.
Thank you in advance
ATTACHMENT PREVIEW Download attachment
Royal Dutch Shipping SoluTonDiscount rate10 PercentCost of Freightor$1,600,000Value of Salvage$160,000YearCash FlowPresent Value Factors0$(1,600,000.0)1.00001$380,000.000.90912$390,000.000.82643$400,000.000.75134$410,000.000.68305$580,000.000.6209Net Present ValueInternal rate of return
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Cost of Freightor x 10% (at end of 5 Yr)Present Value of cash Fows(1,600,000)one Tme investment345,458.00322,296.00300,520.00280,030.00360,122.00$8,426.00Present value of the future cash ±ow sums10.19%
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