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Calculation Thrivio101

THRIVIO PTY LTD is planning to invest $760,000 in a property project involving the purchase and renovation of an undervalued house on a large lot in Australia. The project anticipates generating an annual gross income of $477,360 with operating costs of $88,370, leading to a projected net income of -$456,143 during the construction period. The financial analysis indicates a net present value of $3,225,213 and an internal rate of return of 28% over the project's lifetime.

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70 views9 pages

Calculation Thrivio101

THRIVIO PTY LTD is planning to invest $760,000 in a property project involving the purchase and renovation of an undervalued house on a large lot in Australia. The project anticipates generating an annual gross income of $477,360 with operating costs of $88,370, leading to a projected net income of -$456,143 during the construction period. The financial analysis indicates a net present value of $3,225,213 and an internal rate of return of 28% over the project's lifetime.

Uploaded by

livain
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as XLSX, PDF, TXT or read online on Scribd
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THRIVIO PTY LTD

AUSTRALIA
Property

Size Land 700 - 900


The Amount of Room 17
Size / Room 20 - 25

Capital Expenditure (CapEx)


Purchase Price Undervalued older house on large lot (700–900 m²) $ 600,000
Renovation and Convertion $ 100,000
Furniture and Appliance $ 25,000
Permits and Approval $ 5,000
Stamp Duty Legal Fee $ 30,000
Total Initial Investment $ 760,000

Operating Costs
Property Management (7%) From Annual Income $ 35,490.00
Council Rates & Water, Maintenance & Repairs $ 16,500.00
Utilities Cleaning $ 22,000.00
Loan Interest 6.5% from $152,000 $ 9,880.00
Insurance $ 3,500.00

Revenue Projections
Rent Room/ Week $600 with 17 rooms Fill $ 10,200.00
Annual Gross Income Multiply 52 Week With occupantion Rate 90% $ 477,360.00

Cost of Capital
Equity $ 608,000
Debt $ 152,000
Interest Rate 0.06
Annual Return Equity 0.12
Tax 0.25

Weighted Average Cost of Capital


Cost
Equity 12.00%
Debt 4.50%

Depreciation Asset Value


Rennovation and Convertion $ 100,000
Furniture and Appliance $ 25,000
Accumulated Depreciation
(m2)
Rooms
(m2)

Per Week
Annualy

Weight Weighted Cost


80.00% 9.60%
20.00% 0.90%
10.50%

Useful Life In Year Depreciation Expense


20 $ 5,000
5 $ 5,000
$ 10,000
THRIVIO PTY LTD
AUSTRALIA
Property

CASH FLOW
Construction Period 5-6 Month
All figures in AUD unless stated -
Initial Investment 760,000
Revenue 0.04 238,680
Operating Cost
Property Management (7%) From Annual Income 35,490
Council Rates & Water, Maintenance & Repairs 2% 16,500
Utilities Cleaning 2% 22,000
Insurance 3,000
Depreciation and Amortization 10,000
EBITDA (588,310)
Loan Interest 6.5% from $152,000 9,880
EBT (608,190)

Tax 25% (152,048)

Net Income (456,143)

CAPITAL BUDGETING ANALYSIS


Construction Period 5-6 Month
All figures in AUD unless stated 0
Initial Investment (760,000)
Operating Cash Flow (456,143)
Terminal Cash Flow
Total Cash Flow (1,216,143)
Cumulative Free Cash Flow (1,216,143)

Present Value of Cashflow (1,216,143)


Present Value of Cumulative Free Cashflow (1,216,143)

Net Present Value 3,225,213


Internal Rate of Return 28%
Break Event Point 3.929
1 2 3 4 5 6 7

477,360 496,454 516,313 536,965 558,444 580,781 604,013

35,490 35,490 35,490 35,490 35,490 35,490 35,490


16,830 17,167 17,510 17,860 18,217 18,582 18,953
22,440 22,889 23,347 23,814 24,290 24,776 25,271
3,000 3,000 3,000 3,000 3,000 3,000 3,000
10,000 10,000 10,000 10,000 10,000 10,000 10,000
409,600 427,909 446,966 466,801 487,447 508,934 531,298
9,880 9,880 9,880 9,880 9,880 9,880 9,880
389,720 408,029 427,086 446,921 467,567 489,054 511,418

97,430 102,007 106,772 111,730 116,892 122,264 127,855

292,290 306,022 320,315 335,191 350,675 366,791 383,564

1 2 3 4 5 6 7
0.00 0.00 0.00 0.00 0.00 0.00 0.00
292,290 306,022 320,315 335,191 350,675 366,791 383,564

292,290 306,022 320,315 335,191 350,675 366,791 383,564


(923,853) (617,831) (297,516) 37,675 388,350 755,140 1,138,704

264,516 250,627 237,405 224,824 212,860 201,486 190,678


(836,066) (505,994) (220,508) 25,270 235,728 414,815 566,076

AUD
Percent
Years
Project Life-Time
8 9 10 11 12 13 14

628,173 653,300 679,432 706,609 734,874 764,269 794,839

35,490 35,490 35,490 35,490 35,490 35,490 35,490


19,332 19,719 20,113 20,516 20,926 21,345 21,771
25,777 26,292 26,818 27,354 27,901 28,459 29,029
3,000 3,000 3,000 3,000 3,000 3,000 3,000
10,000 10,000 10,000 10,000 10,000 10,000 10,000
554,574 578,799 604,011 630,250 657,556 685,975 715,550
9,880 9,880 9,880 9,880 9,880 9,880 9,880
534,694 558,919 584,131 610,370 637,676 666,095 695,670

133,674 139,730 146,033 152,592 159,419 166,524 173,917

401,021 419,189 438,098 457,777 478,257 499,571 521,752

Project Life-Time
8 9 10 11 12 13 14
0.00 0.00 0.00 0.00 0.00 0.00 0.00
401,021 419,189 438,098 457,777 478,257 499,571 521,752

401,021 419,189 438,098 457,777 478,257 499,571 521,752


1,539,725 1,958,914 2,397,012 2,854,789 3,333,047 3,832,618 4,354,370

180,413 170,667 161,417 152,640 144,316 136,423 128,941


692,700 797,544 883,176 951,895 1,005,759 1,046,612 1,076,102
Project Life-Time
15 16 17 18 19 20 21

826,633 859,698 894,086 929,850 967,044 1,005,726 1,045,955

35,490 35,490 35,490 35,490 35,490 35,490 35,490


22,207 22,651 23,104 23,566 24,037 24,518 25,008
29,609 30,201 30,805 31,421 32,050 32,691 33,345
3,000 3,000 3,000 3,000 3,000 3,000 3,000
10,000 10,000 10,000 10,000 10,000 10,000 10,000
746,327 778,356 811,687 846,372 882,467 920,027 959,111
9,880 9,880 9,880 9,880 9,880 9,880 9,880
726,447 758,476 791,807 826,492 862,587 900,147 939,231

181,612 189,619 197,952 206,623 215,647 225,037 234,808

544,835 568,857 593,855 619,869 646,940 675,110 704,424

Project Life-Time
15 16 17 18 19 20 21
0.00 0.00 0.00 0.00 0.00 0.00 0.00
544,835 568,857 593,855 619,869 646,940 675,110 704,424

544,835 568,857 593,855 619,869 646,940 675,110 704,424


4,899,205 5,468,063 6,061,918 6,681,787 7,328,727 8,003,837 8,708,260

121,852 115,135 108,773 102,749 97,047 91,649 86,542


1,095,700 1,106,718 1,110,328 1,107,571 1,099,373 1,086,557 1,069,852
22 23 24 25

1,087,793 1,131,304 1,176,557 1,223,619

35,490 35,490 35,490 35,490


25,509 26,019 26,539 27,070
34,012 34,692 35,386 36,093
3,000 3,000 3,000 3,000
10,000 10,000 10,000 10,000
999,783 1,042,104 1,086,142 1,131,966
9,880 9,880 9,880 9,880
979,903 1,022,224 1,066,262 1,112,086

244,976 255,556 266,565 278,021

734,927 766,668 799,696 834,064

22 23 24 25
0.00 0.00 0.00 0.00
734,927 766,668 799,696 834,064

734,927 766,668 799,696 834,064


9,443,187 10,209,855 11,009,552 11,843,616

81,710 77,139 72,817 68,729


1,049,901 1,027,276 1,002,478 975,950

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