Phuket Beach Hotel: Valuing Mutually Exclusive Capital Projects
Phuket Beach Hotel: Valuing Mutually Exclusive Capital Projects
Phuket Beach Hotel: Valuing Mutually Exclusive Capital Projects
BEACH
HOTEL
VALUING MUTUALLY
EXCLUSIVE CAPITAL
PROJECTS
CASE
BACKGROUND
Depreciation : equipments & furnitures depreciated equally over the life of the
project using the straight line method, with zero salvage value at the end
Annual Capital Expenditure : Equal Depreciation
DEPRECIATIONS
OPERATING CASHFLOW - PLANET
However, when
compared, the Beach
Karaoke Pub project is
potentially more
profitable than Planet
Karaoke
NET PRESENT VALUE - PLANET
PROJECT RISK
HUMAN RESOURCE RISK
MONETARY RISK
MARKETING RISK
PRODUCTION RISK
SECURITY RISK
FORCE MAJEURE
OPPORTUNITY & SUNK COST
Salaries
Sales Declining
Year 1 2 3 4 5 6
Risk Factor (25%) (1.650.000,00) (1.683.000,00) (1.767.125,00) (1.855.500,00) (1.892.500,00) (1.930.375,00)
Maintenance Cost
IMPORTANT ASPECTS
MAIN SERVICE
SUPPORTING SERVICE
EXTERIOR DESIGN
INTERIOR DESIGN
RECOMMENDATION