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Payback periods average return on investment internal rate of return net present value discounted cash flows Year

Payback periods?

average return on investment?

internal rate of return?

net present value (discounted cash flows)?

Year

0

1

2

3

4

5

initial investment to provide street accessibility

-950 000

         

annual lease income

 

62 000

62 000

62 000

62 000

62 000

increase in lobby bar sales net of costs

 

9 700

10 185

     

decrease in overhead costs

 

200 000

200 000

     

net cash gain from sale of bar equipment

 

80 000

0

0

0

0

less: depreciation on original investment

 

190 000

190 000

190 000

190 000

190 000

next taxable after depreciation

 

161 700

82185

82694,25

83228,983

83790,411

income taxes 25%

 

40 425

20546

20674

20807

20948

add: depreciation

 

190 000

190000

190000

190000

190000

add: decrease in working capital

 

70 000

0

0

0

0

net cash flow

-950 000

381 275

251639

252021

252422

252843

Sep 08 2020 Read more Less More

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