Phuket Beach - 1203 Words

{draw:g} {draw:frame} {draw:frame} {draw:frame} {draw:frame} {draw:frame} {draw:frame} {draw:frame} Table of Contents Declaration This report is submitted as partial fulfilment of the requirements for Module MBA 407 Financial Management at the European Business School London in spring 2010. We declare that this document embodies the results of the group’s work and that it has been composed by the group. Following normal academic conventions, we have made due acknowledgement of the work of others. We have worked together as a group and we have all contributed equally and would therefore be graded as a group. †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦..†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ Fouad El Ghzal †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦..†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ Nikola Pamler †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦..†¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ Ulrich†¦show m ore content†¦But the NPV is not suitable to compare projects running fordifferent time periods. Instead I used the Equivalent Annual Cash Flow to compare both projects, regarding their time-period, as the Equivalent Annual Cash Flow measures the current economic gain for every year in a projects life period. As a result I got an Equivalent Annual Cash Flow of $124,103.76 for the PKC and an Equivalent Annual Cash Flow of $323,731.71 for the BKC. That is why I came to the point that the PKC project would be the better choice as it has the lower Equivalent Annual Cash Flow value which is an indicator for financial security. Even the Beach Karaoke Club (BKC) would have higher financial benefits this investment option is less attractive, due to an uncertain income which leads to a higher risk. If we take several unfavourable situations into account the PKC will still have a positive equivalent annual cash flow while our project’s equivalent that guarantees us annual cash flow will be negative. Even this fixed income from the rent goes only for a 4-years period it is still more attractive than an uncertain income over a 6-years period. I know that you liked the idea of recruit staff for the BKP from the current surplus of the hotel’s workforce, as the BKP project did not has to care about their salaries and does not have opportunity cost’s for recruiting and training. But we also have to consider that maybe one day the hotel requires all their workforce, which will be a problemShow MoreRelatedPhuket Beach Case1683 Words   |  7 PagesPHUKET BEACH HOTEL: VALUING MUTUALLY EXCLUSIVE PROJECTS I. STATEMENT OF THE PROBLEM This is an assessment of the different costs and benefits of two mutually exclusive capital projects involving the use of an underutilized space located on the second floor of the main building of Phuket Beach Hotel (PBH). The first project, Planet Karaoke Pub (PKP) offered to sign a four-year lease agreement with (PBH) while the second project, Beach Karaoke Pub (BKP), is a pub the PBH itself, plans to putRead MorePhuket Beach Hotel1556 Words   |  7 PagesGeneral Manager, Phuket Beach Hotel From: Albert, Andy, Becca, Chris, Derek Consulting Date: June 14, 2011 Re: Valuation of Potential Karaoke Pub Projects Thank you for retaining AaBCD Consulting in the valuation of your future capital improvement project. There are two mutually exclusive capital improvement projects under consideration: lease under-utilized space to an unrelated third party, Planet Karaoke Pub, or invest greater capital to open and manage your own nightclub, Beach Karaoke PubRead MorePhuket Beach Hotel1996 Words   |  8 PagesCase 10:Phuket Beach Hotel VALUING MUTUALLY EXCLUSIVE CAPITAL PROJECTS Case Overview Planet Karaoke Pub Project Lives Monthly rental (5% increment for 3rd and 4th year) 4 years 170, 000 (THB) 770, 000 to 1, 000, 000 (THB) 55, 000 (THB) Up front renovation cost (Depreciated over the life of project - straight line method with zero salvage value) Overhead expenses Repair and maintenance cost 10, 000 (THB) / year Case Overview Beach Karaoke Pub Project Lives Up front investment Read MorePhuket Beach Hotel3020 Words   |  13 PagesFinancial Management. EBS ML. 4th course students. Case study. Phuket Beach Hotel. Valuing Mutually Exclusive Capital Projects. Questions 1. Please asses the economic benefits associated with each of the capital project. What is Initial Outlay? What are the incremental cash flows over the life of the project? What is an appropriate discount rate to use for discounting the cash flows of the project? SN 1 and SN 2 - 40% 2. Are the project comparable based on the standard NPV measure, given thatRead MorePhuket Beach Hotel Case Studey1161 Words   |  5 Pages770,000 6. WACC = 10.75% Yr. 3 Yr. 4 2,142,000 2,142,000 -192500 -192500 -10,000 -10,000 -1,767,125 -1,855,500 172,375 -51,713 120,662 192,500 84,000 -25,200 58,800 192,500 313,162 230,536 251,300 167,039 Analysis of Cash Flow - Beach Karaoke Pub figures in baht Yr. 0 Sales less less less less less Food and Beverage Cost Other Operating Expenses Depreciation Increase in repair and maintenance expenses Decrease in net room revenue Additional Operating Income less Taxes NOPAT addRead MorePhuket Beach Hotel: Valuing Mutually Exclusive Capital Projects846 Words   |  4 Pagesstudent contract (4Ps) Knowing your participants Selecting cases and readings Using a mix of short (â€Å"breather†) and long cases Assigning a term project Case  seminar  series_Su  H  Chan A Short Case Phuket Beach Hotel: Valuing Mutually Exclusive Capital Projects* (4 pages) Synopsis Phuket Beach Hotel has an opportunity to lease its underutilized space to a karaoke pub and earn a rental income. Alternatively, the hotel could develop the unused space and create its own pub. The general manager ofRead MoreExploring Phuket 886 Words   |  4 PagesFEATURE Go for a walk around Phuket. Phuket is well known as a Pearl of Andaman because of its beautiful beach and many tourist places such as Patong Beach, Kata Beach, Karon Beach and Lam Promathep. Actually there are additional factors such as its culture, architect, historic and much more that is enough to make this city became a paradise. City of Tin. In the past, Phuket was the resource of tin exported to many countries in Ayutthaya. The tin industry was the most prosperous reign ofRead MoreThailand Vacation Essay883 Words   |  4 PagesThailand holidays package is enticing mixture of establishing destination like Hua Hin and Phuket. Thailand appeals to many different travelers, whether they are hippy chic or craving barefoot luxury. Thailand provides you plenty of selections for every budget and taste. Pampering is an art form of this beautiful country and throughout the country spas provide authentic treatments if it is in a 5 star resort or a beach side hut. Package Thailand holidays provides you best sightseeing, variegated shoppingRead MoreThe Indian Ocean Tsunami : The Sumatran Andaman Earthquake1463 Words   |  6 Pagesand began to collect stranded fish along the 1.6 miles of exposed beach, which had fatal results. One of the few places to evacuate was an Indonesian Island called Simeulue, which was very close to the epicenter. Another area that evacuated was Maikhao Beach in Northern Phuket, Thailand where a ten year old British student recognized the signs of a tsunami from learning about it in school, and she and her parents warned the beach goers and they evacuated the area. John Chroston, a biology teacherRead MoreEssay on Children Sexual Exploitation in Thailand 1316 Words   |  6 Pagesgoes to Thailand because sexual services are cheaper and the availability is enormous. 3. Pattaya: As I previously stated child sex tourism in Bangkok is decreasing but the same phenomenon is not occurring in other cities such as in Pattaya, Phuket and Chiang Mai where the problem is still relevant. The Pattaya resort is just two hours drive from Bangkok. In the past it was a fishing village but, when the American soldiers fighting in the Vietnam War, discovered Pattaya they â€Å" armed with dollars