Assignment 2: Genesis Capital Plan Repo 071765

Assignment 2 Required Assignment 2—Genesis Capital Plan Report The

The Genesis operations management team, nearing completion of its agreement with Sensible Essentials, was asked by senior management to present a capital plan for the operating expansion. The capital plan was not to be a wish list but an analysis of the necessary expenditures to successfully establish a fully equipped operating facility overseas. In addition, senior management requested meaningful financial and operating metrics to ensure that the performance objectives for the facility were being met. The operations management team was given five days to accomplish the following: Calculate the firm’s WACC. Prepare and analyze each planned capital expenditure.

Evaluate, rank, and recommend the capital expenditures according to beneficial value to the organization, using the evaluation tools NPV, payback, and IRR. Evaluation, ranking, and recommendations should be by category of expenditures. For example, facility, equipment 1, 2, and 3, and inspection. Using the selected choices in part three, calculate the full cost of establishing a fully equipped facility. This would include the facility, equipment 1, 2, and 3, and inspection.

In addition, calculate the payback, NPV, and IRR for the completed facility. Construct and recommend between three and five metrics to measure the performance of the organization. At least one metric should be dividend decision-making driven. Prepare an executive summary along with a separate document showing the calculations. Part I Following the example of the operations management team, do the following: Download the Capital Budgeting spreadsheet, and compute the WACC for Genesis.

Using the information provided in the spreadsheet, analyze Genesis’s project options. Then, calculate the periodic and cumulative net cash flows for each potential project and its associated options. Please note that there are five projects (facility, equipment pieces 1, 2, and 3, and internal inspection), and that each project offers multiple-configuration options (facility size, equipment type, etc.). Evaluate, rank, and recommend a specific option for each capital project according to beneficial value to the organization, using the evaluation tools NPV, payback, and IRR. Construct and recommend between three and five metrics to measure the performance of the new operating strategy.

At least one metric should reflect dividend policy as it relates to rewarding shareholders. Prepare an executive summary describing your recommendations for each project and the overall cost, net cash flows, and expected returns of the operating configuration that you recommend. Be sure to justify your recommendations in terms of the investment criteria applied in Step 3 above. Be sure to report the full cost of the facility as it is configured per your recommendations. Present and justify your operating strategy performance metrics.

Your complete report should include all of your calculations as appendices (5 pages, or 1 page for each project). Part II—Executive Summary Presentation Because of limited resources in an era of plentiful opportunities, companies must carefully select investments. You analyzed Genesis’ expansion plans and explained your findings in M5: Assignment 1 . This assignment is based on those findings. In this assignment, you will create a PowerPoint presentation that will include the following information: An executive summary of your findings from M5: Assignment 1 .

Be sure to adhere to the following: The presentation should be approximately 6–8 minutes (or 10–12 slides). A statement of the problem or topic is included. A concise analysis of the findings is included. Specific details from M5: Assignment 1 to highlight or support the summary are incorporated. Develop a original, no cut & paste / unplagiarised 10–12-slide presentation in PowerPoint format.

Apply APA standards to citation of sources. Use the following file naming convention: LastnameFirstInitial_M5_A2.ppt. By Monday, March 10, 2014 , deliver your assignment to the M5: Assignment 2 Dropbox .

Paper For Above instruction

This assignment focuses on developing a comprehensive capital investment and strategic performance evaluation plan for Genesis, a firm preparing for overseas operational expansion. The goal is to systematically analyze potential investments, estimate associated costs, financial returns, and project viability, and then communicate these findings effectively through detailed reports and a concise PowerPoint presentation. The process involves calculating essential financial metrics such as the Weighted Average Cost of Capital (WACC), Net Present Value (NPV), Payback Period, and Internal Rate of Return (IRR), each serving as key decision-making tools for ranking and selecting projects best aligned with the organization’s value creation objectives.

In Part I of the assignment, the operations management team is required to calculate Genesis’s WACC, which serves as the critical discount rate for project valuation. This involves analyzing the firm’s cost of debt and equity, factoring in the capital structure proportions, and determining an appropriate combined cost of capital (Berk & DeMarzo, 2020). Using a pre-existing Capital Budgeting spreadsheet, the team will evaluate five different projects—comprising a facility setup, three distinct equipment options, and an internal inspection process—each with multiple configurations. The objective is to project cash flows, analyze total costs, and assess the profitability of each option using NPV, Payback Period, and IRR criteria. These financial metrics enable a nuanced ranking of each option, emphasizing the most beneficial expenditure in terms of strategic value—and ultimately aiding in selecting the optimal configuration for site setup and operational effectiveness.

The costs estimates include all necessary expenditures for a fully equipped facility: the physical infrastructure, three types of equipment, and inspection costs. These calculations are critical to understanding the total investment required. For each project and configuration, the team must produce periodic and cumulative cash flow statements, facilitating the comparison of long-term value creation versus initial investments. These data assessments will direct the recommendation of the most advantageous options based on investment return metrics, with particular attention to NPV and IRR as robust indicators of project viability (Damodaran, 2010).

Further, the team must develop at least three to five performance metrics to evaluate the success of the new operating strategy. These metrics should include financial performance indicators, operational efficiency measures, and at least one dividend-related metric that aligns with shareholder return policies. The metrics serve as a strategic dashboard, providing ongoing performance insights post-implementation.

The final step in Part I involves synthesizing these analyses into a comprehensive executive summary that articulates the recommended project configurations, associated costs, cash flow expectations, and anticipated returns. This summary is a strategic narrative intended for senior management, supporting informed decision-making based on quantitative financial assessments.

Part II involves creating a PowerPoint presentation that succinctly encapsulates these findings. The presentation should include an overview of the problem statement, key analytical results, and strategic recommendations, all structured to be delivered within 6–8 minutes or across 10–12 slides. It must be original, well-organized, and free of plagiarism, with proper APA citations for any referenced sources. The presentation is a visual summary designed to communicate the core findings to senior executives effectively, emphasizing the recommended projects and their expected financial and strategic impact. The final deliverable must follow the specified naming conventions and be submitted by the designated deadline.

References

• Berk, J., & DeMarzo, P. (2020). Corporate Finance (5th ed.). Pearson.
• Damodaran, A. (2010). Investment Valuation: Tools and Techniques for Determining the Value of Any Asset. Wiley.
• Ross, S. A., Westerfield, R., & Jaffe, J. (2019). Corporate Finance (12th ed.). McGraw-Hill Education.
• Brealey, R. A., Myers, S. C., & Allen, F. (2020). Principles of Corporate Finance (13th ed.). McGraw-Hill Education.
• Peterson Drake, P., & Fabozzi, F. J. (2019). Capital Budgeting: Theory and Practice. Wiley.
• Brigham, E. F., & Ehrhardt, M. C. (2019). Financial Management: Theory & Practice. Cengage Learning.
• Graham, J. R. (2018). Corporate Debt Management. Harvard Business Review Press.
• Copeland, T., Weston, J. F., & Shastri, K. (2020). Financial Theory and Corporate Policy. Pearson.
• Chorafas, D. N. (2021). Strategic Risk Management and Corporate Governance. Routledge.
• Higgins, R. C. (2018). Analysis for Financial Management. McGraw-Hill Education.