Precision Machines Case Study Tutorial Step-by-Step – Part 2

Part 2: Cash Disbursements for Precision Machines

The second step in this lesson is to set the cash disbursements for precision machines. Most of the values have been filled in, so it’s just a matter making a few simple calculations with excel.

 
  • Student: Martin Gibson
  • Textbook: Capital Budgeting
  • Course: FIN 370
 

Material Purchases

Material purchases can be determined by multiplying each  revenue cell by the rate of 50%.

Start by multiplying material purchases by 50%

Start by multiplying material purchases by 50%

The next step is to find the total in each column. The quickest way to perform this step is by using the SUM function in excel. Now you should have fully totaled columns in each yellow cell like those pictured below.

Total up the cash disbursements using the SUM function in excel

Total up the cash disbursements using the SUM function in excel

Precision Machines Step-by-Step

Check out our three part series on precision machines. 

 

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