1.Use Exhibit TN3 spreadsheet. The company changes its capital structure by issuing 500 million Franco dollars of debt in a no-corporate-tax environment. Fill out the green-shaded cells using the financial information provided in the case and excel.

can you please provide formulas as well? Thank you in advance!

Exhibit TN3 M&M PIZZA Estimates of Cost of Capital and Valuation Effects of Recapitalization in No-Corporate-Tax Environment (in millions of Franco dollars, except per-share figures) Corporate tax rate 0.0% Interest rate 4.0% Market premium 5% **** Debt Capitalization **** Debt = 0 Debt-500 Income Statement Formulas Revenue 1500 1500 Operating expenses 1375 1375 Operating profit Interest payments 0 Taxes 0 Net profit 125 125 125 Dividends Shares outstanding Dividends per share 125 62.5 2.00 Cash flows Debt holders Equity holders Free cash flow 0 125 125 - EBIT*(1-T) 4.00% Cost of Capital Cost of debt Beta Cost of equity WACC 4.00% 0.800 8.00% 8.00% - Unlevered beta * ( 1+ (1 - tax rate) * Debt/Equity) 0.0 Value Debt Equity Total 1562.5 1562.5 Share price 25.0 - Int payments / Kd -Div payments / Ko - Sum or FCF/WACC -DPS / Ke - Value of unlevered + Tax shield -D/(VD) =D/V Value of Firm D/E D/V 1562.5 0.000 0.000 Exhibit TN3 M&M PIZZA Estimates of Cost of Capital and Valuation Effects of Recapitalization in No-Corporate-Tax Environment (in millions of Franco dollars, except per-share figures) Corporate tax rate 0.0% Interest rate 4.0% Market premium 5% **** Debt Capitalization **** Debt = 0 Debt-500 Income Statement Formulas Revenue 1500 1500 Operating expenses 1375 1375 Operating profit Interest payments 0 Taxes 0 Net profit 125 125 125 Dividends Shares outstanding Dividends per share 125 62.5 2.00 Cash flows Debt holders Equity holders Free cash flow 0 125 125 - EBIT*(1-T) 4.00% Cost of Capital Cost of debt Beta Cost of equity WACC 4.00% 0.800 8.00% 8.00% - Unlevered beta * ( 1+ (1 - tax rate) * Debt/Equity) 0.0 Value Debt Equity Total 1562.5 1562.5 Share price 25.0 - Int payments / Kd -Div payments / Ko - Sum or FCF/WACC -DPS / Ke - Value of unlevered + Tax shield -D/(VD) =D/V Value of Firm D/E D/V 1562.5 0.000 0.000