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Bentley Corp. and Rolls Manufacturing are considering a merger. The possible states of the economy and each company's value in that state are shown
Bentley Corp. and Rolls Manufacturing are considering a merger. The possible states of the economy and each company's value in that state are shown here: State Boom Probability Bentley Rolls .75 Recession .25 $308,000 $278,000 119,000 89,000 Bentley currently has a bond issue outstanding with a face value of $134,000. Rolls is an all-equity company. a. What is the value of each company before the merger? (Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.) Value of Bentley Value of Rolls + b. What are the values of each company's debt and equity before the merger? (Leave no cells blank be certain to enter "0" wherever required. Do not round intermediate calculations and round your answers to the nearest whole number, e.g., 32.)
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