IT PROJECT ANALYSIS AND PROPOSAL
P A G E 1
Apple Inc. Financial Fact Sheet Strategic Goals for Apple Inc. (AAPL)
1. Innovate products to secure a greater share of customer spending on hardware, software, and/or digital content.
2. Expand technology to enable growth in digital content delivery.
3. Diversify product offerings to become less dependent on the sales of any particular product.
Financial Facts
Assume everything in this section is in millions Estimated Next Quarter Profit (Loss) Total revenue from Sales Total Cost of sales Gross Profit Operating Expenses Desired units to be sold 18,000 Desired units in ending inventory 15,000 Estimated units in beginning inventory 20,000 Other Revenue and Expenses
Interest Expense 850$ Interest Revenue 921$
Direct Materials Cost Direct Materials Cost including labor 535$
Average Product Sale per Item Apple products 900$
Overhead Cost Budget Indirect salaries Supervisor salaries Maintenance Depreciation Power Total cost for all overhead 5,650,000$
NWM2: IT Project Analysis and Proposal Apple Inc. Financial Fact Sheet
P A G E 2
Selling and Administrative Budget Sales salaries Advertising expenses Travel Officer expenses Supplies Total cost for all selling and administrative budget 4,275,000$ Income Tax Rate
Tax Rate 21%
Capital Budget Components Current cost of equity 10% Current cost of debt 6% Current cost of preferred stock 12.50% Tax rate 32%
Expected Cash Flows from Project Initial cost of project 12,560,000$ Project life cycle 5 years Year 1 5,750,000$ Year 2 3,750,000$ Year 3 3,650,000$ Year 4 2,250,000$ Year 5 1,500,000$
Present Value of $1 at Compound Interest Year 6% 8% 10% 12% Year 1 0.943 0.926 0.909 0.893 Year 2 0.89 0.857 0.826 0.797 Year 3 0.84 0.794 0.751 0.712 Year 4 0.792 0.735 0.683 0.636 Year 5 0.747 0.681 0.621 0.567 Year 6 0.705 0.630 0.564 0.507 Year 7 0.665 0.583 0.513 0.452 Year 8 0.627 0.540 0.467 0.404 Year 9 0.592 0.500 0.424 0.361 Year 10 0.558 0.463 0.386 0.322
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