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Genesis Capital plan report
The Genesis operations management team, nearing completion of its agreement with Sensible Essentials, was asked by senior management to present a capital plan for the operating expansion. The capital plan was not to be a wish list but an analysis of the necessary expenditures to successfully establish a fully equipped operating facility overseas.
In addition, senior management requested meaningful financial and operating metrics to ensure that the performance objectives for the facility were being met. The operations management team was given five days to accomplish the following:
Calculate the firm’s WACC.
Prepare and analyze each planned capital expenditure.
Evaluate, rank, and recommend the capital expenditures according to beneficial value to the organization, using evaluation tools NPV, payback, and IRR. Evaluation, ranking, and recommendations should be by category of expenditures. For example, facility, equipment 1, 2, and 3, and inspection.
Using the selected choices in part three, calculate the full cost of establishing a fully equipped facility. This would include the facility, equipment 1, 2, and 3, and inspection. In addition, calculate the payback, NPV, and IRR for the completed facility.
Construct and recommend between three and five metrics to measure the performance of the organization. At least one metric should be dividend decision-making driven.
Prepare an executive summary along with a separate document showing the calculations.
Following the example of the operations management team, do the following:
Download the Capital Budgeting spreadsheet, and compute the WACC for Genesis.
Using the information provided in the spreadsheet, analyze Genesis’s project options.
Using the information provided, calculate the periodic and cumulative net cash flows for each potential project and its associated options. Please note that there are 5 projects (facility, equipment pieces 1, 2, and 3, and internal inspection) and that each project offers multiple configuration options (facility size, equipment type, etc.).
Evaluate, rank, and recommend a specific option for each capital project according to beneficial value to the organization, using evaluation tools NPV, payback, and IRR.
Construct and recommend between three and five metrics to measure the performance of the new operating strategy. At least one metric should reflect dividend policy as it relates to rewarding shareholders.
Prepare an executive summary describing your recommendations for each project and the overall cost, net cash flows, and expected returns of the operating configuration that you recommend. Be sure to justify your recommendations in terms of the investment criteria applied in Step 3 above. Be sure to report the full cost of the facility as it is configured per your recommendations. Present and justify your operating strategy performance metrics.
Your complete report should include all of your calculations as appendices (5 pages, or 1 page for each project).
Write a 5–6-page report in Word format. Apply APA standards to citation of sources. Use the following file naming convention: LastnameFirstinitial_M6_A2.doc.
March 17, 2012, deliver your assignment to the M6: Assignment 2 Dropbox.
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Genesis Capital xxxxxx
The xxxxxxxx on xxxxxxx outlays xx among xxx most xxxxxxxxxxx a firm has to make. x decision to build x xxx plant or expand into x foreign xxxxxx may xxxxxxxxx the xxxxxxxxxxx of xxx firm over the xxxx decade. The xxxxxxx budgeting decision xxxxxxxx xxx xxxxxxxx of expenditures for a xxxxxxx xxxx x xxxx of at xxxxx xxx xxxx xxx usually considerably xxxxxxx xxxxxxx xxxxxxxxx xxxxx in xxxxxxxxxxx xxxx how should x firm xxxxxx xxx capital.
Evaluation xx the project
xxxxxxxxx xxxxxxx budgeting xxxxxxx xxxx are: Payback period (which analysis xxx time or number xx years xxxxx is required xx cover xxx xxxxxxx outlay xx investment xx the xxxxxxxxx Accounting Rate xx return (this is also xxxxx as Return on investment, which measures xxx profitability of xx investment xxxxxxxxxxx its financial statements), xxxxxxxxxx xxxxxxx period xxxxxx analysis xxx time or number of years which xx required to cover the xxxxxxx xxxxxx
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xxxxxxx xxxxxxxxxx xxxxxxxxxxxxxxxxx
xxxxxxx Operations xxxxxxxxxx
xxxxxxx has xxxxxxxxxx xx US. Genesis Manufactures xxxx end xxxxxxxxx xxxxxxxx based xxxxxxxxxxxxxxxxx xxx xxx xxxxxxxx operating Center xx xxxxxx only. Genesis wanted expand its business xx outside xx
xxx xxxxxxx Corporation develops highly xxxxxxxxx software and xxxxxxxx xxxxxxxxxxxx for xxxxxxxx xxxxxxxxxx xxx xxxxxxxx xxxx Genesis xx considering expanding its xxxxxxxxxx xxxxxxxxxx xx lower xxxx locations xxxxxxx xxx United States. xxx company currently xxx facilities xx xxxxxx xxx xxxxxxxx xxx need for xxxxxxx xxxxxxxxx in order xx xxxxxxx timely to global customers.
xxxxxxx has two xxxxxxxxx xxxxxxxxxxx xxxxx one xx xxx Family Seeding xxxxxx one xx Equity Investment The available xxxxxxxxx xxxxxxx xxx xxx fulfill xxx xxxxxxxxx xxxxxx of xxx xxxxxxx in xxx xxxx
At xxxxxxx Genesis xxx only xxx financing options xxxxxxxxx which xxx not very xxxxxxxxx xx its xxxxxxxxxx
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