Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Given Gross Margin 40% Fixed Costs $ 2,000 Revenue Growth Rate for Years 1 - 5 10% FCF Steady Growth 3% Discount Rate 12% Year
| Given | |||||||||||
| Gross Margin | 40% | ||||||||||
| Fixed Costs | $ 2,000 | ||||||||||
| Revenue Growth Rate for Years 1 - 5 | 10% | ||||||||||
| FCF Steady Growth | 3% | ||||||||||
| Discount Rate | 12% | ||||||||||
| Year 1 Revenue | $ 5,000 | ||||||||||
| Tax Rate | 21% | ||||||||||
| Terminal Year | 5 | ||||||||||
| 1 | 2 | 3 | 4 | 5 | |||||||
| Revenues | |||||||||||
| Gross profits | |||||||||||
| Fixed Costs | |||||||||||
| Net Operating Income | |||||||||||
| Taxes | |||||||||||
| Free Cash Flow | |||||||||||
| NPV for Years 1-5 Cash Flows | | ||||||||||
| Terminal Value (as of Year 5) | |||||||||||
| PV of Terminal Value | |||||||||||
| Enterprise Value | |||||||||||
| PV of Terminal Value / Enterprise Value | |||||||||||
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started