Equity Valuation - Financial Markets

Give what is asked and show your solution.

1. At the end of 2020, the balance sheet of ABC Company showed total assets of P4 million pesos, total liabilities of P2.5 million, preference shares of P250,000, and 120,000 outstanding shares. How much is the book value per share of the company?

2. Upon further evaluation, ABC Company found out that the assets can only be realized at P3.4 million. How much is the liquidation value per share of the company?

3. Investor Joseph wants to buy shares of XYZ Company. XYZ Company's shares are currently selling at P20 per share on the Philippine Stock Exchange (PSE). Research shows that dividends are stable at P5 per year and it is expected to be resold at P35 per share after a year. Joseph expects a 7% return on his investment and plans to hold the shares of XYZ Company for a year. What is the value of the shares after a year?