problem 18 8

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FM CONSIGNMENT

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Sheet1PROBLEM NO 18-8PARTICULARS12345REVENUE WITH POOL ( A )NO OF MEMBERS500600700700700MEMBERSHIP FEE450450450450450REVENUE WITH POOL225,000.00270,000.00315,000.00315,000.00315,000.00

REVENUE WITH OUT POOL ( B)NO OF MEMBERS400400400400400MEMBERSHIP FEE250250250250250REVENUE WITH POOL100,000.00100,000.00100,000.00100,000.00100,000.00

Sheet1 (2)PROBLEM NO 18-8END OF YEAR0123455*ADDITIONAL REVENUE125,000.00170,000.00215,000.00215,000.00215,000.00LESS: ADDITIONAL COST-120,000-120,000-120,000-120,000-120,000TOTAL CASH INFLOWS5,000.0050,000.0095,000.0095,000.0095,000.00SCRAPE VALUE200,000.00TOTAL CASH OUT FLOWS-500,000P V FACTOR 10%10.9090.82640.75130.6830.620920.62092PRESENT VALUE-5000004,545.0041,320.0071,373.5064,885.0058,987.40124,184.00

NPV=TOTAL CASH INFLOWS-TOTAL OUT FLOWS365,294.90-500,000.00=-134706REJECTED

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