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Consider the following data for Company Average Inc. Please note Average Inc is up for sale. Annual net profit: $640,000 BV of net assets: $4,800,000
Consider the following data for Company Average Inc. Please note Average Inc is up for sale. Annual net profit: $640,000 BV of net assets: $4,800,000 FV of assets: $ 5,000,000 Normal industry average on Net assets: 15% Mr Wise is willing to buy Average Inc. and pay a goodwill amount equal to above-average earnings for 5 years. What price should Mr Wise quote? (please show calculations)
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Financial Accounting and Reporting
Authors: Barry Elliott, Jamie Elliott
14th Edition
978-0273744535, 273744445, 273744534, 978-0273744443
