Swot Analysis of Mercury Drug Store

Questions ON PROBLEM 1 a. Determine the slander associated following a while the new equipment, as well-mannered-mannered-mannered as the unused slander on the old equipment. b. Determine the specie inflows (following slander and taxes) associated following a while the new equipment. c. Determine the specie outflows associated following a while the equipment. Illusion each of the items that would answer in the T-account. Then illusion twain the specie inflows and specie outflows in the T-account. d. Determine (1) the net exhibit compute, (2) the profitability renunciation, (3) the interior blame of recompense, and (4) the payback bound of the designed contrivance. DEPRECIATION USING MACRS TABLE (NEW EQUIPMENT) ST YR 75,000. 00 X 33. 33% = 24,997. 50 2ND Yr 75,000. 00 x 44. 45% = 33,3337. 50 3rd Yr. 75,000. 00 x 14. 81 % = 11,107. 50 4th yr 75,000. 00 x 7. 41 % = 5,557. 50 DEPRECIATION USING MACRS TABLE (NEW EQUIPMENT) 1ST YR 50,000. 00 X 33. 33% = 16,665 2ND Yr 50,000. 00 x 44. 45% = 22,225. 00 3rd Yr. 50,000. 00 x 14. 81 % = 7,405. 00 4th yr 50,000. 00 x 7. 41 % = 3,705. 00 16,665. 00 + 22,225. 00 + 7,405. 00 = 46,295. 00 16,665. 00 + 22,225. 00 + 7,405. 00 = 46,295. 00 50,000. 00 – 46,495 = 3,705. 00 Unused Slander on old equipment CASH INFLOWS/CASH OUTFLOWS FOR NEW EQUIPMENT 1ST YEAR TOTAL SAVINGS 30,000. 00 Less: Slander Expense 24,997. 50 Freight Expense 5,000. 00 Working Capital 3,000. 00 32,997. 50 Income antecedently Tax ( 2,992. 500 ) VVVVVVVVVVVV 2nd YEAR TOTAL SAVINGS 30,000. 0 Less: Slander Expense 33,337. 50 Working Capital (30,000 x 12%) 3,600. 00 36,937. 50 Income antecedently Tax ( 6,937. 50) Vvvvvvvvvvv 3rd YEAR TOTAL SAVINGS 30,000. 00 Less: Slander Expense 11,107. 50 Working Capital (30,000 x 12%) 3,600. 0 14,707. 50 Income antecedently Tax 15,292. 50 Income Tax (15,292. 50 x 30%) 4,587. 50 NET INCOME 10,705. 00 VVVVVVVVV 4TH YEAR TOTAL SAVINGS 20,000. 0 Less: Slander Expense 5,557. 50 Working Capital (20,000 x 12%) 2,400. 00 7,957. 50 Income antecedently Tax 12,042. 50 Income Tax (12,042. 50 x 30%) 3,612. 75 NET INCOME 8,429. 5 VVVVVVVVV C A S H FLOW _____________________________________ CASH IN : CASH OUT 30,000. 00 : 75,000. 00 30,000. 00 : 5,000. 00 30,000. 00 : 3,000. 00 20,000. 0 : 3,600. 00 : 3,600. 00 : 4,587. 50 : 3,612. 75 Totals 110,000. 00 : 98,400. 25 Vvvvvvvvvv vv vvv vvv NET PRESENT VALUE: P 1,500. 00 SINCE MACHINE IS FULLY DEPRECIATED PROFITABILITY INDEX/INTERNAL RATE OF RETURN 1ST YEAR - NONE ND YEAR - NONE 3RD YEAR - 10,705. 00 / 30,000. 00 = 36% 4TH YEAR - 8429. 75 / 20,000. 00 = 42% Payback bound starts on the 3RD YEAR….. QUESTIONS ON PROBLEM 2 a. Determine the slander associated following a while the new equipment, as well-mannered-mannered-mannered as the unused slander on the old equipment. b. Determine the specie inflows (following slander and taxes) associated following a while the new equipment. c. Determine the specie outflows associated following a while the equipment. Illusion each of the items that would answer in the T-account. Then illusion twain the specie inflows and specie outflows in the T-account. d. Determine (1) the net exhibit compute, (2) the profitability renunciation, (3) the interior blame of recompense, and (4) the payback bound of the designed contrivance. DEPRECIATION USING MACRS TABLE (NEW COMPUTER) 1ST YR 83,000. 00 X 20% = 16,600. 00 2ND Yr 83,000. 00 x 32% = 26,560. 00 3rd Yr. 83,000. 00 x 19. 20 % = 15,936. 00 4th yr 83,000. 00 x 11. 52 % = 9,561. 60 5TH YEAR 83,000. 00 X 11. 52% = 9,561. 60 6TH YEAR 83,000 X 5. 76% = 4,780. 80 TOTAL P 83,000. 00 DEPRECIATION USING MACRS TABLE (OLD COMPUTER) 1ST YR 97,000. 00 X 20% = 19,400. 00 2ND Yr 97,000. 00 x 32% = 31,040. 0 3rd Yr. 97,000. 00 x 19. 20 % = 18,624. 00 4th yr 97,000. 00 x 11. 52 % = 11,174. 40 5TH YEAR 97,000. 00 X 11. 52% = 11,174. 40 6TH YEAR 97,000 X 5. 76% = 5,587. 20 TOTAL P 97,000. 00 UNUSED DEPRECIATION OF OLD COMPUTER IS 5,587. 50 CASH INFLOWS/CASH OUTFLOWS FOR NEW EQUIPMENT 1ST YEAR TOTAL SAVINGS 20,000. 00 Less: Slander Expense 16,600 Electrical Wirings 2,300. 0 Working Capital 3,500. 00 22,400. 00 Income antecedently Tax ( 2,400,00 ) VVVVVVVVVVVV 2nd YEAR TOTAL SAVINGS 20,000. 00 Less: Slander Expense 26,560. 0 Working Capital (20,000 x 14%) 2800. 00 29. 360. 50 Income antecedently Tax ( 9,360. 50) Vvvvvvvvvvv 3RD YEAR TOTAL SAVINGS 20,000. 00 Less: Slander Expense 15,936. 00 Working Capital (20,000 x 14%) 2800. 00 18,736. 0 Income antecedently Tax 1,264. 00 Income Tax (1,264. 00 x 35%) 442. 40 NET INCOME 821. 60 VVVVVVVV 4thYEAR TOTAL SAVINGS 20,000. 00 Less: Slander Expense 9,561. 0 Working Capital (20,000 x 14%) 2800. 00 12,361. 60 Income antecedently Tax 7,638. 40 Income Tax (7638. 40 x 35%) 2,673. 44 NET INCOME 4,964. 96 VVVVVVVV thYEAR TOTAL SAVINGS 20,000. 00 Less: Slander Expense 9,561. 60 Working Capital (20,000 x 14%) 2800. 00 12,361. 60 Income antecedently Tax 7,638. 40 Income Tax (7638. 40 x 35%) 2,673. 44 4,964. 96 vvvvvvvvv thYEAR TOTAL SAVINGS 20,000. 00 Less: Slander Expense 4,780. 80 Working Capital (20,000 x 14%) 2800. 00 7,580. 80 Income antecedently Tax 12,419. 20 Income Tax (12419. 20x 35%) 4,346. 72 NET INCOME 8,072. 48 Vvvvvvvv C A S H FLOW _____________________________________ CASH IN : CASH OUT 20,000. 00 : 83,000. 00 20,000. 00 : 2,300. 00 20,000. 00 : 3,500. 00 20,000. 00 : 2,800. 00 20,000. 0 : 2,800. 00 20,000. 00 : 442. 40 : 2,800. 00 : 2,673. 44 : 2,800. 00 : 2,673. 44 : 2,800. 00 : 4,346. 2 Totals 120,000. 00 : 112,936. 00 Vvvvvvvvvv vv vvv vvv NET PRESENT VALUE: P 4,500. 00 SINCE MACHINE IS FULLY DEPRECIATED PROFITABILITY INDEX/INTERNAL RATE OF RETURN 1ST YEAR - NONE 2ND YEAR - NONE 3RD YEAR - 821. 60 / 20,000. 00 = 4% 4TH YEAR - 4964. 96 / 20,000 = 25% 5TH YEAR - 4964. 96 / 20,000 = 25% 6TH YEAR - 8072. 48 / 20,000 = 40% Payback bound starts on the 3RD YEAR….. Enmar (NICO) P. Matuguinas BSBA_Marketing Management 3rd