Page 135 - DMGT521_PROJECT_MANAGEMENT

Project Management Neha Tikoo, Lovely Professional University

Notes Unit 9: Financial Estimates and Projections

CONTENTS
Objectives
Introduction
9.1 Financial Projections
9.1.1 Cost of Project
9.1.2 Land and Site Development
9.1.3 Buildings and Civil Works
9.1.4 Plant and Machinery
9.1.5 Cost of Stores and Spares
9.2 Means of Finance

9.2.1 Planning the Means of Finance
9.3 Working Capital Requirement and its Financing
9.3.1 Profitability Projections (or Estimates of Working Results)
9.3.2 Projected Balance Sheet
9.4 Time Value of Money
9.4.1 Future Value of Single Amount
9.4.2 Present Value of a Single Amount
9.5 Cost of Capital
9.5.1 Concept of Average Cost of Capital
9.5.2 Cost of Equity
9.5.3 Determining the Proportions
9.5.4 Weighted Marginal Cost of Capital
9.5.5 Misconception Surrounding Cost of Capital
9.6 Appraisal Criteria

9.6.1 Market Appraisal
9.6.2 Characterisation of Market
9.7 Risk Analysis in Capital Investment Decisions
9.7.1 Strategies for Controlling Risk
9.7.2 Need for New Concept
9.8 Projected Cash Flow Statement
9.9 Projected Balance Sheet
9.10 Financing of a Project
9.11 Summary
9.12 Keywords
9.13 Review Questions
9.14 Further Readings

130 LOVELY PROFESSIONAL UNIVERSITY