FIN20014: Financial Management - FASTOUT Corporation - Report Writing - Finance Assignment Help

Assignment Task:

Details of Assignment
FASTOUT Corporation is an automation company that invests heavily in research and development (R&D) before introducing any new machine, which are mostly innovative labour saving alternatives. Manufacturing firms in the industry are customers of FASTOUT Corporation. Recently, FASTOUT spent $130,000 to innovate an automatic food processing machine AFP20 to reduce wastage; however, the machine AFP20 is not fully ready yet for the market due to its occasional imperfection in separating residue and fine output, as reflected in a few random trial runs. Such infrequent failures require long reset time. Firms installing AFP20 may experience significant production loss during reset time. Nonetheless, due to the pressure of severe competition, FASTOUT managers are planning to introduce this machine AFP20 in the market before any new offer from competitors. The company is expecting that the final version of reliable machine AFP20-M would be available for production in four years’ time.

Required machinery for building the plant to manufacture machine AFP20 can be procured from a local importer at a cost of $6,200,000. FASTOUT Corp. has to incur additional transportation cost of $50,000 and installation costs of $250,000; whereas the local importer  will pay the import duty of $500,000. The plant would have an economic life of five years and will be depreciated for tax purposes using straight line rate of 20 per cent per year. At the end of this project, the plant would be transferred (i.e., sold) to another project at a price of $700,000.

The Marketing manager of FASTOUT Corp has projected that 300 units of the machine AFP20 can be sold in the first year and that sales will drop by 25 units every year during the life of the project. Expected sales price would be $50,000 per unit. Variable cost of production is estimated to be 60% of sales revenue as long annual production is at least 200 units. Fixed factory overhead of $1,800,000 per year would be allocated to this production plant. 

Required
Using Excel Spreadsheet (as explained in the eLearning video of Week-6), prepare a full analysis to be presented to the CFO of FASTOUT Corp. in evaluating whether either project should be started or not. Your analysis should include the following
Table of cash flows (Show all digits, do not convert amounts to $ in million or thousand)
Use of excel formulae where appropriate (refer eLearning video of Week-6)
A formal report (1500 +/- 10% words excluding table of content, executive summary, tables, references and appendices) outlining your recommendation as to whether FASTOUT Company should proceed with either project. Justify your recommendations using quantitative and qualitative issues and your analysis of probable risks and benefits relating to the project. Comparative statement using 14 per cent and 19 per cent required rate is to be presented in a separate section in the report. 

This FIN20014: Finance Assignment has been solved by our Finance Experts at My Uni Paper. Our Assignment Writing Experts are efficient to provide a fresh solution to this question. We are serving more than 10000+ Students in Australia, UK & US by helping them to score HD in their academics. Our Experts are well trained to follow all marking rubrics & referencing style.

Be it a used or new solution, the quality of the work submitted by our assignment experts remains unhampered. You may continue to expect the same or even better quality with the used and new assignment solution files respectively. There’s one thing to be noticed that you could choose one between the two and acquire an HD either way. You could choose a new assignment solution file to get yourself an exclusive, plagiarism (with free Turnitin file), expert quality assignment or order an old solution file that was considered worthy of the highest distinction.