GF520 · Unit 5

GF520 Unit 5 project appraisal memo example

Corporate Finance Purdue University Global Free custom sample in 24 to 48h

A model does not approve anything; a person signs, and the GF520 Unit 5 memo is often written for that person. This example is addressed to the treasurer of a composite medical-supply distributor weighing a second regional distribution center, and it converts a ten-year model into two pages that state the recommendation, the condition attached, and the number that would reverse it.

What this page holds

Recommendation on page one, model in the exhibits: a GF520 Unit 5 project appraisal memo backing a 22-million-dollar distribution center, conditional on signed anchor volume. Searches like "gf 520 unit 5 assignment example", "gf520 unit 5 sample" and "gf520 unit 5 example" land here.

What a finished GF520 Unit 5 project appraisal memo looks like

Two pages under a standard memo heading, with a boxed recommendation and three exhibits. The recommendation reads: proceed with the second distribution center, subject to signed supply agreements covering at least 85 percent of first-year volume. Beneath it, three numbers carry the case, a net present value of 2.4 million dollars at the firm's 8.8 percent rate, an internal return of 11.0 percent, and a margin of safety showing annual cash flow can fall about 10 percent before value is gone. The body explains why that margin is thin for a ten-year commitment, names the two hospital systems whose contracts account for most of the forecast, and sets out what happens if one declines. Exhibits carry the cash flow summary, a scenario table and a note on how the rate was derived.

How a GF520 Unit 5 example is structured

The memo is written to be read in the order a treasurer reads: decision, reason, risk, detail. Heading lines name the reader, the writer, the date and a subject that states the recommendation rather than the topic. A three-sentence opening delivers the recommendation and its condition. The case for the project follows in one paragraph built around net present value, with the internal return offered as a check and never as the headline. The risk paragraph is the longest, because the margin of safety is narrow, and it names the specific volume assumption, the contracts behind it, and the fallback if either contract is lost. A paragraph on financing notes that the project would draw on the existing revolver and confirms covenant headroom. Last comes the reversing condition, with the exhibits behind it for readers who want the model.

A subject line that decides

The subject line reads as the recommendation itself, so a treasurer scanning an inbox knows the answer before opening the memo.

A condition attached to the yes

Approval depends on signed agreements covering 85 percent of first-year volume, turning a forecast into a commitment the firm can verify before spending.

Value first, return second

Net present value of 2.4 million leads the case, and the 11.0 percent internal return appears only as corroboration against the 8.8 percent hurdle.

A thin margin, said plainly

Cash flow can fall roughly 10 percent before the project stops earning its cost of capital, and the memo treats that narrowness as the central risk.

Exhibits behind the argument

Cash flow summary, scenarios and the rate derivation sit in three exhibits, keeping the body to what the signer needs in order to decide.

Where marks go in GF520 Unit 5

The memo is graded as a decision document, so the costliest weakness is a missing or buried recommendation. A memo that walks through the model in order and reaches a verdict on page two has written a report in the wrong genre. Unconditional approval of a project with a narrow margin draws the next deduction, since the rubric in many sections asks whether the writer understood what the numbers depend on. Leading with internal rate of return rather than net present value is marked down in many graduate sections. Technical language pitched at an analyst rather than a treasurer loses points for audience. Risk discussed as a generic list, with no link to the specific contracts, earns little. Exhibits that contradict the memo's own figures are treated as errors wherever they surface.

Get a GF520 Unit 5 example written to your instructions

Who signs off in your GF520 Unit 5 case, and what did the model produce? Send those outputs, or the case data if the model is still unbuilt, with the prompt and rubric. The memo returns addressed to that reader, recommendation first and conditions stated. It is free as a first custom sample and usually ready in 24-48h.

GF520 Unit 5 questions, answered

How long should an appraisal memo be?

Usually one to three pages plus exhibits, though your prompt governs. Treasurers and committees read memos quickly, so length beyond what the decision needs tends to cost rather than earn. The sample keeps the body to two pages and places the full model in exhibits, which satisfies rubrics that ask for both concision and supporting analysis in the same submission.

Can the memo recommend rejecting the project?

Yes, and a well-argued rejection often scores as well as an approval. What matters is that the verdict follows from the analysis and names what would change it. A memo recommending rejection would state the shortfall in value, the assumption that would have to improve, and whether a smaller or delayed version of the project might pass instead.

Should the spreadsheet go inside the memo?

Summary exhibits belong in the memo; the spreadsheet is attached when the instructions call for one. Treasurers rarely want raw model tabs inside a decision document. The sample shows three exhibits, cash flows, scenarios and the rate derivation, and the custom version can supply the underlying file separately when your section requires one.