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Combination Analysis Pro Forma Please show work fill out red Problem 2 80% Debt Pro-Forma Target Buyer NewCo Book Value Mkt Value Book Value Mkt

Combination Analysis Pro Forma Please show work fill out red

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Problem 2 80% Debt Pro-Forma Target Buyer NewCo Book Value Mkt Value Book Value Mkt Value 12/31/2018 12/31/2018 12/31/2018 12/31/2018 12/31/2018 Current Assets 50,000 40,000 500,000 400,000 1 PP&E 2,000,000 4,000,000 9,000,000 8,000,000 3 Goodwill Other Assets 200,000 300,000 800,000 750,000 Total Assets 2,250,000 4,340,000 10,300,000 9, 150,000 9 Accts Payable 50,000 50,000 50,000 50,000 1 Long-Term Debt 1,000,000 1,290,000 4,000,000 4, 100,000 Equity 1,200,000 3,000,000 6,250,000 5,000,000 5 Total Liabilities and Equity 2,250,000 4,340,000 10,300,000 9, 150,000 16 7 2019E EPS 1.00 3.00 18 Shares Outst 100,000 75,000 100,000.00 1 Price/Share 40.00 40.00 12 P/E Multiple 40x 13.33x 4 Debt/Capital 45.5% 39.0% 15 Interest Rate on Debt pre-tax 8.0% 16 Percent Debt 80.0% 8 Tax Rate for both 25.0%

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