Project Presentation This Project is actually due today Monday the 6th by 11pm
You have been asked to present this project to a group of executives in your company who are trying to determine who they will appoint as the project manager of the next strategic project.
You will need to create a 10 slide PowerPoint presentation of your project .Each slide must contain notes to backup your points of view. This presentation should address each of the deliverables in your project which are as follows:
· Week 1: Project Topic Approval
· Week 2: Project Selection
· Week 3: Project Scope and Work Breakdown Structure
· Week 5 Resource Allocations
· Week 6: Risk and Performance Analysis
· Week 7: Project Control
· Week 8: Project Close Out Letter Small Lake Cabin Project
Small Lake Cabin Project
Herbert J Greene
Week 2 Assignment
July 28, 2021
27 July 2021
Dear Dr., Cuffee,
I am writing about the Lake project deliverable required for the semester. The contents of this letter are effective in understanding how the lake project shall get conducted and how the financial calculations involved. Since I am fronting most of the money this is what the calculations on what will be needed to complete the project.
1. Net present value
Estimated investment of the lake house project is $40,000. After completion and once tenants move in, the expected returns from the lake house are $5,000, $8,000, and $10,000. The appropriate rate of return is 9%. Calculation of net present value is as follows:
NPV= (5000÷ (1+0.09) ^1) +(8000÷ (1+0.09) ^2) +(10000÷ (1+0.09) ^3)-40000
2. Pay back period
Total project investment budget is $40,000
Annual cash flow is expected to be $10,000
Pay back period is 40000÷10000= 4 years
3. Cost benefit analysis
Increase in revenue by 30% when new construction materials get sourced
Payment of workers=$15000
Materials cost =$10000
Total direct and indirectly costs are 15000+10000+5000=$30000
Increase in revenue can get estimated at $50000
The benefit-cost ratio produces 50000÷30000=1.66
The value is positive and there would be an increase in revenue. Thus, purchase of new material would offer better outcomes.
4. Benefit-cost ratio (BCR)
The lake house project gets conducted by leasing equipment for $10,000. The BCR shall be NPV÷cost of leasing
The positive value of BCR indicates that the benefits are far much better than internal costs.
Rationale for Recommendations
Calculation of NPV is an initial factor required to determine how the project would be viable in the future. Thelake house project shall involve different cnstructors and equipment selected for different stages in the project. As such, the proper method of understanding the lake project’s capability of generating profits requires the NPV. NPV gets used as an analysis tool to implement effective capital budgeting processes for the project getting studied (Jagerson, 2021). Since the final calculation indicated that the NPV was a positive value, it was thus easy to finalize the idea that the project’s viability would get guaranteed. Having positive and reliable cash flows in the project is an effective method of handling the project’s improvement as it indicates how the project correlates with different goals.
Assessment of the payback period is a suitable method to handle the project’s completion. This is majored on the fact that a breakeven point gets reached once the project’s activities get conducted in a rewuired way. It is possible to rely on the lake project’s payback period assessment that generates clear directions for participants t submit all deliverables on time.
The cost benefit analysis process offered a positive value indicating positive viability of the project’s activities. It was possible to perform the assessment and determining how the lake project would operations with different equipment.
Application of the benefit cost ratio further offered better understanding of how the project would work in future. Since there are different direct and indirect costs for the project’s operations it would be imperative to implement the BCR analysis. The technique determines value of money used to handle the project’s activities (Hayes, 2020). The lake projects value was greater than one indicating a possibility of generating positive revenue.
After assessing all calculations, it was clear that improvement of thelake project would be possible by using diverse valid calculations to increase productivity. I believe the contents of this letter shall provide understanding of the lake project’s deliverables.
Hayes, A. (2020). Benefit-Cost Ratio. Retrieved 26 July 2021 from https://www.investopedia.com/terms/b/bcr.asp
Jagerson, J. (2021). What is the formula for Calculating Net Present Value? Retrieved 26 July 2021 from https://www.investopedia.com/ask/answers/032615/what-formula-calculating-net-present-value-npv.asp