Please post equations for learning and study, please.
---------------
Please post equations for learning and study, please. Cook Wares has a target debt ratio (debt/value)...
2. A firm currently has $10 million in debt, $40 million in cash, and 10 million shares outstanding. If the present value of the firm's free cash flows is $120 million, what should be its share price? 4. If the tax rate is 40%, what are the net proceeds from selling an asset for $90,000? Assume the asset originally had a book value of $20,000. 7. ReMATE Incorporate expects free cash flow earnings of $6 million next year. Since the...
Yr FCF 1 8M 2 10M A firm expects the free cash flows listed above. After year 2, the firm expects free cash flows will continue to grow indefinitely at the industry average of 5%. The firm estimates its cost of capital to be 8%. If the firm has debt of 540 million and cash of $20 million, what is its enterprise value? Assume 10 million shares outstanding,
Yr FCF 1 6M 2 10M A firm expects the free cash flows listed above. After year 2, the firm expects free cash flows will continue to grow indefinitely at the industry average of 5%. The firm estimates its cost of capital to be 8%. If the firm has debt of $40 million and cash of $20 million, what is its enterprise value? Assume 10 million shares outstanding.
Hannibal Corp. has a cost of equity of 12%, and an after-tax cost of debt of 7%. Using market values, Hannibals debt is 40% of the value of the firm and its equity is 60% of the value of the firm. What is the weighted average cost of capital? Dexter Corp. can borrow at 9% and is has a 23% marginal tax rate. What is the after-tax cost of debt? Columbia Corporation has a beta of 1.6, the risk-free rate...
QUESTION 8 Yr FCF 14M 2 10M A firm expects the free cash flows listed above. After year 2, the firm expects free cash flows will continue to grow indefinitely at the industry average of 5%. The firm estimates its cost of capital to be 8%. If the firm has debt of $40 million and cash of $20 million, what is its enterprise value? Assume 10 million shares outstanding QUESTION 9 An asset with a book value of $80,000 is...
Please show the work.. ABC Inc is looking to launch an acquisition of a target for $3 billion. The target is expected to generate cash flows for five years. Table 1 below shows the expected cash flows of the target along with the acquisition cost. Table 2 shows the financial data required to generate a discount factor for the cash flows. 1. Calculate the discount rate (WACC) for the acquisition. 2. Evaluate the deal using NPV, IRR, and Payback. Consider...
Question 8 (of 12) > В. value: 10.00 points Fyre, Inc., has a target debt-equity ratio of 1.50. Its WACC is 9.7 percent, and the tax rate is 40 percent a. If the company's cost of equity is 14 percent, what is its pretax cost of debt? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Cost of debt 11.39 % b. If instead you know that the aftertax cost of...
Please Post Equations for study and learning please. Rand is considering a new project that requires an investment of $60 million in machinery. This is expected to produce sales of $94 million per year for 4 years and operating expenses of $71 million per year for 4 years. The machinery will be fully depreciated to a zero book value over 4 years using straight-line depreciation. They can sell it for $5 million at the end of 4 years. Working capital...
Photochronograph Corporation (PC) manufactures time series photographic equipment. It is currently at its target debt-equity ratio of .65. It’s considering building a new $64 million manufacturing facility. This new plant is expected to generate aftertax cash flows of $7.6 million in perpetuity. The company raises all equity from outside financing. There are three financing options: 1. A new issue of common stock: The flotation costs of the new common stock would be 7.2 percent of the amount raised. The required...
Hastings Corporation is interested in acquiring Vandell Corporation. Vandell has 1 million shares outstanding and a target capital structure consisting of 30% debt; its beta is 1.35 (given its target capital structure). Vandell has $11.22 million in debt that trades at par and pays an 7.9% interest rate. Vandell’s free cash flow (FCF0) is $1 million per year and is expected to grow at a constant rate of 5% a year. Both Vandell and Hastings pay a 30% combined federal...