I’m having trouble with this data case and I’m not sure if it’s because I’m overthinking it or if I’m just not grasping what it is asking.
Specifically, I’m having trouble determining how to calculate Cost of Goods Sold as well as what Selling, Admin, and Research and Devel. costs would be each year. I also bolded the parts of the question below that I am having issues with.
I have put the question below and also attached an Excel doc with the work that I have completed so far and all of the supporting documents and information. Any help or advice would be much appreciated!
You have just been hired by Internal Business Machines Corporation (IBM) in their capital budgeting division. Your first assignment is to determine the free cash flows and NPV of a proposed new type of tablet computer similar in size to an iPad but with the operating power of a high-end desktop system.