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Can you please help me solve this 2 part question using two different scenarios with the numbers priovided? Theres 2 screenshots provided here. Thank you
Can you please help me solve this 2 part question using two different scenarios with the numbers priovided? Theres 2 screenshots provided here. Thank you very much! (Solve for blank spots)
BQ, Inc., is considering making an offer to purchase iReport Publications. The vice president of finance has collected the following information: BQ iReport Price-earnings Shares Earnings 8.8 1,500,000 165,000 $4,600,000 $680,000 12.2 ratio outstanding Dividends $ 960,000 $410,000 BQ also knows that securities analysts expect the earnings and dividends of iReport to grow at a constant rate of 4 percent each year. BQ management believes that the acquisition of iReport will provide the firm with some economies of scale that will increase this growth rate to 6 percent per year a. What is the value of iReport to BQ? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) calculations and round your answer to 2 decimal places, e.g., 32.16.) acquisition be? (Do not round intermediate calculations and round your answer to 2 b. What would BQ's gain be from this acquisition? (Do not round intermediate c. If BQ were to offer $36 in cash for each share of iReport, what would the NPV of the decimal places, e.g., 32.16.) d. What's the most BQ should be willing to pay in cash per share for the stock of iReport? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) e. If BQ were to offer 190,000 of its shares in exchange for the outstanding stock of iReport, what would the NPV be? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) Check my work BQ's outside financial consultants think that the 6 percent growth rate is too optimistic and a 5 percent rate is more realistic. f-1. What is the value of iReport to BQ now? (Do not round intermediate calculations f-2. What would BQ's gain be from this acquisition? (Do not round intermediate f-3. If BQ were to offer $36 in cash for each share of iReport, what would the NPV of the and round your answer to 2 decimal places, e.g., 32.16.) calculations and round your answer to 2 decimal places, e.g., 32.16.) acquisition be? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) What's the most BQ should be willing to pay in cash per share for the stock of iReport? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g, 32.16.) f-4. f-5. IBQ were to offer 190,000 of its shares in exchange for the outstanding stock of Report, what would the NPV be? (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.) f-1. Value of iReport f-2. Gain f-3. NPV f-4. Maximum share price f-5. NPV Prev1 of 1 Next Step by Step Solution
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