Quadrex Hardware
	WEBSITE BUDGETING TOOL
	12/1/2022
	Company data	Rate
	Required rate of return	10%
	Tax rate	30%
	Initial investment in website	Year
	Hardware (e.g., servers)	$25,000.00
	Software (e.g., e-commerce catalog software)	$15,000.00
	Development (e.g., third-party site design and development)	$150,000.00
	Total initial investments	$190,000.00
	Benefits from website	Year 1	Year 2	Year 3
	Direct sales	$15,000.00	$50,000.00	$75,000.00
	Incremental sales resulting from enhanced promotional/salesperson effectiveness	$25,000.00	$25,000.00	$25,000.00
	Incremental sales resulting from increased partner participation	$25,000.00	$25,000.00	$25,000.00
	Reduced travel costs	$25,000.00	$25,000.00	$25,000.00
	Reduced customer service costs	$50,000.00	$50,000.00	$50,000.00
	Total benefits	$140,000.00	$175,000.00	$200,000.00
	Costs (excluding initial capital investments)	YEAR 1	YEAR 2	YEAR 3
	Cost of sales	$7,500.00	$25,000.00	$37,500.00
	Maintenance	$15,000.00	$15,000.00	$15,000.00
	Project management, customer support	$35,000.00	$35,000.00	$35,000.00
	Online advertising, search-engine registration	$10,000.00	$10,000.00	$10,000.00
	Depreciation on capital expenditures (calculation uses three-year period)	$63,333.33	$63,333.33	$63,333.33
	Total costs	$130,833.33	$148,333.33	$160,833.33
	Totals		Year 1	Year 2	Year 3
	Net benefits (costs)		$9,166.67	$26,666.67	$39,166.67
	Tax		$2,750.00	$8,000.00	$11,750.00
	Value after tax		$6,416.67	$18,666.67	$27,416.67
	Depreciation added back		$63,333.33	$63,333.33	$63,333.33
	Cash flow	-$190,000.00	$69,750.00	$82,000.00	$90,750.00
	Cumulative cash flow	-$190,000.00	($120,250.00)	($38,250.00)	$52,500.00
	Evaluation metrics	Values
	Net present value (NPV)	$9,359.50
	Internal rate of return (IRR)	12.66%
	Payback period (in years)	2.42