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Find FCF, W d, W E, r d , r E, and WACC below.Year 4 FCF has already been calculated ($5,824,400). Synthetic Appendix Reinsertion Division

Find FCF, Wd, WE, rd ,rE, and WACC below.Year 4 FCF has already been calculated ($5,824,400).

Synthetic Appendix Reinsertion Division Projected

Time

0

1

2

3

4

Forecast Sales

$0

$23,500,000

$24,500,000

$25,500,000

$26,500,000

COGS

$0

$14,100,000

$14,700,000

$15,300,000

$15,900,000

Gross Profit

$0

$9,400,000

$9,800,000

$10,200,000

$10,600,000

SG&A

$0

$3,760,000

$3,920,000

$4,080,000

$4,240,000

EBITDA

$0

$5,640,000

$5,880,000

$6,120,000

$6,360,000

Depreciation

-$20,000,000

$0

$0

$0

$0

EBIT

-$20,000,000

$5,640,000

$5,880,000

$6,120,000

$6,360,000

Taxes

-$4,200,000

$1,184,400

$1,234,800

$1,285,200

$1,335,600

EBIT (1-T)

-$15,800,000

$4,455,600

$4,645,200

$4,834,800

$5,024,400

+Depreciation

$20,000,000

$0

$0

$0

$0

CapEx

-$20,000,000

$0

$0

$0

$200,000

Chg in NOWC

-$600,000

$0

$0

$0

$600,000

FCF

-$??,???,???

$?,???,???

$?,???,???

$?,???,???

$5,824,400

ADDITIONAL INFORMATION:

Stock price = $45

# of shares outstanding = 50,000,000

BV ~ MV of interest-bearing debt = $750,000,000

10-year T-note = 3%

Yield Spread = 280 basis points

Tax rate = 21%

Beta = 1.67

Market (Equity) Risk Premium = 5%

Assume capital structure percentages are optimal and will remain the same

COMPLETE THE FOLLOWING:

Wd = 0.??

WE = 0.??

rd = ?.??%

rE = ?.??%

WACC = ?.???%

Synthetic Appendix Reinsertion Division

NPV $???,???

IRR ?.??%

MIRR 8.33%

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