Essay About Yearly Cash Flow And Limited Budget

The Investment Detectives
The Investment Detectives
Case Analysis:  The Investment DetectivesGroup MembersPREPARED By:Kumar VivekMP13031Rajeev DasMP13040Sanjiv RanjanMP13048Suraj P.UpadhyayMP13062Vishav Bandhu SharmaMP13070Case Background Capital budgeting and resource allocation is a major job of an entrepreneur. Any wrong investment will lead a major loss to the organization. With the limited budget (Capital Sources) and several options available for investment thing become tougher. The capital budget analyst work is to find the bad evidence from good looking projects. That is why they are call detectives.Case Issues: An overview There are eight projects with initial investment of $2 million and yearly cash flow as in the table. Figures in red provided the year in which payback was accomplished.Project No12345678Initial Investment-2000-2000-2000-2000-2000-2000-2000-2000Cash inflow in year 13301666 16028022001200-350Cash inflow in year 2330334 200280 900-60Cash inflow in year 3330165 350280 30060Cash inflow in year 4330  395280 90350Cash inflow in year 5330  432280 70700Cash inflow in year 6330  440280  1200Cash inflow in year 7330  442280  2250Cash inflow in year 81000  444280   Cash inflow in year 9   446280   Cash inflow in year 10   448280   Cash inflow in year 11   450280   Cash inflow in year 12   451280   Cash inflow in year 13   451280   Cash inflow in year 14   452280   Cash inflow in year 15  10000-2000280   Sum of Cash Flow benefit331021651000035614200220025604150Excess of cash flow over initial investment13101658000156122002005602150 NB:         1) discount rate: 10%