Contents
Summary………………………………………………………………………………3
Analysis of Investment………………………………………………………………..3
Assumptions…………………………………………………………………...3
Financial Statements…………………………………………………………...5
Cash Flow Forecast…................………………………………….......5
Profit and Loss Statement...…………………………………………..6
Balance Sheet…...…………………………………………………….7
Calculating Return from Investment………………………………………......8
Discussion…………………………………………………………………………….10
Acceptability of Return from Investment……………………………………...10
Alternative Uses of Our Invested Money..…………………………………….11
Final Statement………………………………………………………………………12
References…………………………………………………………………………….13
Summary
‘Envirotech Ltd. Is a company that manufactures domestic appliances using…‘environmentally friendly’ technology’ (Major Project Autumn 2006). It currently produces a technology called Mark I for which it receives a licence fee and royalties from an investing company, Otori. It has entered an agreement as of 1 July 2004 with Otori to help develop a new technology Mark II, which details the payment of monthly development fee over three years and a decision at 31 December 2007 either to:
- Scenario 1: Purchase the company and rights to the technology from Envirotech
- Scenario 2: Continue paying a licence fee plus royalties for the use of the technology
- Scenario 3: Discontinue the relationship insofar as the Mark II technology, but continue paying the licence fee and royalties for Mark I
The aim of this financial document is to analyse whether it is worthwhile investing a minimum of $50 000 i ...