财务管理(英文第十三版).ppt

Chapter12,CapitalBudgetingandEstimatingCashFlows,CapitalBudgetingandEstimatingCashFlows,TheCapitalBudgetingProcessGeneratingInvestmentProjectProposalsEstimatingProject“After-TaxIncrementalOperatingCashFlows”,WhatisCapitalBudgeting?,Theprocessofidentifying,analyzing,andselectinginvestmentprojectswhosereturns(cashflows)areexpectedtoextendbeyondoneyear.,TheCapitalBudgetingProcess,Generateinvestmentproposalsconsistentwiththefirmsstrategicobjectives.Estimateafter-taxincrementaloperatingcashflowsfortheinvestmentprojects.Evaluateprojectincrementalcashflows.,TheCapitalBudgetingProcess,Selectprojectsbasedonavalue-maximizingacceptancecriterion.Reevaluateimplementedinvestmentprojectscontinuallyandperformpostauditsforcompletedprojects.,ClassificationofInvestmentProjectProposals,1.Newproductsorexpansionofexistingproducts2.Replacementofexistingequipmentorbuildings3.Researchanddevelopment4.Exploration5.Other(e.g.,safetyorpollutionrelated),ScreeningProposalsandDecisionMaking,1.SectionChiefs2.PlantManagers3.VPforOperations4.CapitalExpendituresCommittee5.President6.BoardofDirectors,Advancementtothenextleveldependsoncostandstrategicimportance.,EstimatingAfter-TaxIncrementalCashFlows,Cash(notaccountingincome)flowsOperating(notfinancing)flowsAfter-taxflowsIncrementalflows,Basiccharacteristicsofrelevantprojectflows,EstimatingAfter-TaxIncrementalCashFlows,IgnoresunkcostsIncludeopportunitycostsIncludeproject-drivenchangesinworkingcapitalnetofspontaneouschangesincurrentliabilitiesIncludeeffectsofinflation,Principlesthatmustbeadheredtointheestimation,TaxConsiderationsandDepreciation,Generally,profitablefirmsprefertouseanacceleratedmethodfortaxreportingpurposes(MACRS).,Depreciationrepresentsthesystematicallocationofthecostofacapitalassetoveraperiodoftimeforfinancialreportingpurposes,taxpurposes,orboth.,DepreciationandtheMACRSMethod,Everythingelseequal,thegreaterthedepreciationcharges,thelowerthetaxespaidbythefirm.Depreciationisanoncashexpense.Assetsaredepreciated(MACRS)ononeofeightdifferentpropertyclasses.Generally,thehalf-yearconventionisusedforMACRS.,MACRSSampleSchedule,DepreciableBasis,Intaxaccounting,thefullyinstalledcostofanasset.Thisistheamountthat,bylaw,maybewrittenoffovertimefortaxpurposes.DepreciableBasis=CostofAsset+CapitalizedExpenditures,CapitalizedExpenditures,CapitalizedExpendituresareexpendituresthatmayprovidebenefitsintothefutureandthereforearetreatedascapitaloutlaysandnotasexpensesoftheperiodinwhichtheywereincurred.Examples:Shippingandinstallation,SaleorDisposalofaDepreciableAsset,Oftenhistorically,capitalgainsincomehasreceivedmorefavorableU.S.taxtreatmentthanoperatingincome.,Generally,thesaleofa“capitalasset”(asdefinedbytheIRS)generatesacapitalgain(assetsellsformorethanbookvalue)orcapitalloss(assetsellsforlessthanbookvalue).,CorporateCapitalGains/Losses,Capitallossesaredeductibleonlyagainstcapitalgains.,Currently,capitalgainsaretaxedatordinaryincometaxratesforcorporations,oramaximum35%.,CalculatingtheIncrementalCashFlows,Initialcashoutflow-theinitialnetcashinvestment.Interimincrementalnetcashflows-thosenetcashflowsoccurringaftertheinitialcashinvestmentbutnotincludingthefinalperiodscashflow.Terminal-yearincrementalnetcashflows-thefinalperiodsnetcashflow.,InitialCashOutflow,a)Costof“new”assetsb)+Capitalizedexpendituresc)+(-)Increased(decreased)NWCd)-Netproceedsfromsaleof“old”asset(s)ifreplacemente)+(-)Taxes(savings)duetothesaleof“old”asset(s)ifreplacementf)=Initialcashoutflow,IncrementalCashFlows,a)Netincr.(decr.)inoperatingrevenueless(plus)anynetincr.(decr.)inoperatingexpenses,excludingdepr.b)-(+)Netincr.(decr.)intaxdepreciationc)=Netchangeinincomebeforetaxesd)-(+)Netincr.(decr.)intaxese)=Netchangeinincomeaftertaxesf)+(-)Netincr.(decr.)intaxdepr.chargesg)=Incrementalnetcashflowforperiod,Terminal-YearIncrementalCashFlows,a)Calculatetheincrementalnetcashflowfortheterminalperiodb)+(-)Salvagevalue(disposal/reclamationcosts)ofanysoldordisposedassetsc)-(+)Taxes(taxsavings)duetoassetsaleordisposalof“new”assetsd)+(-)Decreased(increased)levelof“net”workingcapitale)=Terminalyearincrementalnetcashflow,ExampleofanAssetExpansionProject,BasketWonders(BW)isconsideringthepurchaseofanewbasketweavingmachine.Themachinewillcost$50,000plus$20,000forshippingandinstallationandfallsunderthe3-yearMACRSclass.NWCwillriseby$5,000.LisaMillerforecaststhatrevenueswillincreaseby$110,000foreachofthenext4yearsandwillthenbesold(scrapped)for$10,000attheendofthefourthyear,whentheprojectends.Operatingcostswillriseby$70,000foreachofthenextfouryears.BWisinthe40%taxbracket.,InitialCashOutflow,a)$50,000b)+20,000c)+5,000d)-0(notareplacement)e)+(-)0(notareplacement)f)=$75,000*,*Notethatwehavecalculatedthisvalueasa“positive”becauseitisacashOUTFLOW(negative).,IncrementalCashFlows,Year1Year2Year3Year4a)$40,000$40,000$40,000$40,000b)-23,33131,11510,3675,187c)=$16,669$8,885$29,633$34,813d)-6,6683,55411,85313,925e)=$10,001$5,331$17,780$20,888f)+23,33131,11510,3675,187g)=$33,332$36,446$28,147$26,075,Terminal-YearIncrementalCashFlows,a)$26,075TheincrementalcashflowfromthepreviousslideinYear4.b)+10,000SalvageValue.c)-4,000.40*($10,000-0)Note,theassetisfullydepreciatedattheendofYear4.d)+5,000NWC-Projectends.e)=$37,075Terminal-yearincrementalcashflow.,SummaryofProjectNetCashFlows,AssetExpansionYear0Year1Year2Year3Year4-$75,000*$33,332$36,446$28,147$37,075*NoticeagainthatthisvalueisanegativecashflowaswecalculateditastheinitialcashOUTFLOWinslide12-18.,ExampleofanAssetReplacementProject,Letusassumethatpreviousassetexpansionprojectisactuallyanassetreplacementproject.Theoriginalbasisofthemachinewas$30,000anddepreciatedusingstraight-lineoverfiveyears($6,000peryear).Themachinehastwoyearsofdepreciationandfouryearsofusefulliferemain-ing.BWcansellthecurrentmachinefor$6,000.Thenewmachinewillnotincreaserevenues(remainat$110,000)butitdecreasesoperatingexpensesby$10,000peryear(old=$80,000).NWCwillriseto$10,000from$5,000(old).,InitialCashOutflow,a)$50,000b)+20,000c)+5,000d)-6,000(saleof“old”asset)e)-2,400-f)=$66,600,(taxsavingsfromlossonsaleof“old”asset),CalculationoftheChangeinDepreciation,Year1Year2Year3Year4a)$23,331$31,115$10,367$5,187b)-6,0006,00000c)=$17,331$25,115$10,367$5,187a)Representthedepreciationonthe“new”project.b)Representtheremainingdepreciationonthe“old”project.c)Netchangeintaxdep