Ocean carriers - case study solution by gkolbaia in types school work and ocean carriers case study solution. Executive sum-up ocean carriers is contemplating the chance of qualifying a 3-year leasing contract that would necessitate commissioning the building of a new vas in the short term applied hire rates are diminishing merely as they should be on the recovery side get downing 2003. B) assume that ocean carriers is located in hong kong, where owners of hong kong registered ships are not required to pay any tax on profits comparing the npv without tax, assuming the company is located in hong kong, to npv with a 35% tax rate, assuming the company is based in the us, the project would not cover the cost of capital of 9% if . Ocean carriers case study recommendation to mary linn as to whether ocean carriers, inc should purchase a new ship we must first look at the net present value of .
Capital budgeting applications powerpoint presentation, ppt - docslides- implementing the npv rule ocean carriers january 2001, mary linn of ocean carriers is evaluating the purchase of a new capesize carrier for a 3-year lease proposed by a motivated customer. Ocean carriers case npv excel free essays - studymode 99+ customer review essays - largest database of quality sample essays and research papers on ocean carriers case npv excel. Ocean carriers evaluates the lease and possible scrapping of a ship, involving net working capital, asset sale, and tax treatment issues in forecasting cash flows.
Following this recommendation would be the only scenario where ocean carriers sees a positive net present value of the investment—the investment would yield a npv after 25 years of $977,267 scrapping at any year before or after 25 years would be non-optimal. Net present value (npv) 316665 ocean carriers case study add remove harvard business case: 9-202-027 discount air carriers, and even ocean vessels can . Capital budgeting applications implementing the npv rule ocean carriers january 2001, mary linn of ocean carriers is evaluating the purchase of a. Ocean carriers owns and operates capesize vessels that carry iron ore worldwide round cape horn– longer and riskier routes npv at different deviations from base.
Scribd is the world's largest social reading and publishing site. Background ocean carriers inc - ocean carrier introduction is a shipping company specializing in the operation of capsizes bulk dry carriers in january 2001, mary linn, the vice president of finance for ocean carriers was evaluating the purchase of a new capsize carrier for a three years lease proposed by a motivated customer. Ocean carriers case solution,ocean carriers case analysis, ocean carriers case study solution, in january 2001, mary linn, vice president of finance for ocean carriers, a shipping company with offices in new york and hong kong, was to evaluate the pr.
View lab report - class 18 - ocean carriers case study from business m marketing at queen mary, university of london class 18 group name: the wolves of wall street names: nicola obereder, beatrice. Ocean carriers case report ocean carriers must use net present value (npv) analysis to decide whether or not to accept a ship building project, which will cost . Ocean carriers case solution - mary linn, v p of ocean carriers (a shipping company), is evaluating a recommended lease from the ship for just about any three year period. After considering alternative investment opportunities and risk mitigation strategies it was found that it is a good opportunity to invest in commissioning of new ship, provided the ship is registered in hk instead of ny. The net present value on the ocean carrier is not a positive number, a clear indicator that buying the vessels is not a good idea the tax rate of 35% makes a lot of difference in determining this npv .
A critical element in determining net present value is the discount rate used in your calculations this is the rate at which future cash flows are adjusted to the present day in the previous . Ocean carriers final essay the reasonableness of the company’s policy can be analysed by comparing the npv of 15-year project to the npv of 25-year project . Economic profits (npv) are “excess” returns all projects earn zero “excess” returns in a long- term competitive equilibrium does ocean carriers differ from the theoretical “long run competitive equilibrium” 25 years. Ocean carriers the wal-mart vs sears dilemma as the newest member of the smith, mccormley, and mashek investments analysts' team, i have been given the task to .
Essay on ocean carriers case analysis this additional expense of capital will lower the npv of the project funded through issuing debt or reduce net income if . Ocean carriers group 4 ocean carriers ocean carriers: maximum and minimum of the prediction of npv: under taxes of 35% in usa, the npv may fluctuate from .
Assignment help corporate finance 1 should ocean carriers purchase the carrier answer this first for a tax rate of 35%, then for a tax rate of 0%. We have analyzed whether or not ocean carriers should make this investment using free cash flow and net present value (npv) analysis given the details of the contract, the forecasted daily time charter rates, and the costs data we have concluded that ocean carriers should not accept. Ocean carriers is a us firm subject to 35% taxation similarly capital budgeting on working 1 at excel worksheet provides undiscounted net free cash flows of about $34 million discounting these to current value at 10% gives positive npv of approximately $14 million. Net present value/present value index the management team at savage corporation is evaluating two alternative capital investment opportunities the first alternative, modernizing the company’s current machinery, costs $45,000.