Page 295 - Analysis, Synthesis and Design of Chemical Processes, Third Edition
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million. The estimated revenue from years 1 through 10 is $70 million/yr, and the estimated cost of
manufacture over the same time period is $25 million/yr. The internal hurdle rate (interest rate) is
14% p.a., before taxes, and the taxation rate is 40%.
a. Draw a discrete, nondiscounted cash flow diagram for this process.
35. b. Determine the yearly depreciation schedule using the five-year MACRS method.
c. Determine the after-tax profit for each year.
d. Determine the after-tax cash flow for each year.
e. Draw a discrete, discounted (to year 0) cash flow diagram for this process.
f. Draw a cumulative, discounted (to year 0) cash flow diagram for this process.
g. What is the present value (year 0) of this process?
