1. Use the following spreadsheet to solve the questions.

Income Statement 2019 2020 Sales $150,000.00 $175,000.00 Cost of Goods $35,000.00 $38,500.00 Gross Profit $115,000.00 $136,500.00 S&A $15,000.00 $16,500.00 Depreciation $20,000.00 $20,000.00 EBIT $80,000.00 $100,000.00 Interest $5,450.00 $3,437.18 EBT $74,550.00 $96,562.82 Taxes $29,820.00 $38,625.13 Net Income $44,730.00 $57,937.69 Dividends $13,419.00 $17,381.31 Addition to Retained Earnings $31,311.00 $40,556.38 Balance Sheet 2019 2020 Assets Cash and Cash Equivalents $3,000.00 $3,300.00 Acc Receivable $20,000.00 $22,000.00 Inventory $10,000.00 $11,000.00 Short Term Investments $0.00 $2,000.00 Current Assets $33,000.00 $38,300.00 Gross PPE $500,000.00 $530,000.00 Accumulated Depreciation $100,000.00 $120,000.00 Net PPE $400,000.00 $410,000.00 Total Assets $433,000.00 $448,300.00 Liabilities and Equity Accounts Payable $20,000.00 $22,000.00 Accruals $3,000.00 $3,000.00 Notes Payables $15,000.00 $15,000.00 Current Liabilities $38,000.00 $40,000.00 Long Term Debt $100,000.00 $59,743.62 Total Liabilities $138,000.00 $99,743.62 Retained Earnings $98,000.00 $138,556.38 Preferred Stock $10,000.00 $10,000.00 Common Stock $200,000.00 $200,000.00 Total Equity $308,000.00 $348,556.38 Total Liabilities and Equity $433,000.00 $448,300.00

d. Write out the years 2021 to 2025 projected annual FCFs given multistage growth. The short-term growth rate in FCFs is 3% for the next 4 years and the long-run growth rate in FCFs is 1%.

e. Compute the intrinsic value using these 5 years of projected FCFs assuming the terminal value is a growth perpetuity. The WACC is 10% and the first cash flow in the terminal value is the year 5 future FCF.

f. What is the equity value per share assuming there is 9000 shares outstanding?