Hello,

Can somebody explain to me line by line how these numbers were calculated. Thanks!

Warren Buffett's Analysis of Intrinsic Value at Coca-Cola , Discounted Owner Earnings Using a Two-Stage "Dividend" Discount Model (first stage is ten years) Year Prior year cash flow Growth rate (add) Cash flow Discount factor (multiply) Discounted value per annum Sum Of present value Of cash flows Residual Value Cash f',ow in year 10 Growth rate (g) (add) Cash flow in year Capitaliiation rate (- gr- Value at end Of year 10 $828 15% $952 0.9174 $873 2 952 ,095 08417 $ 922 s 1,095 S 1,259 07722 $ 972 $ 3,349 5% s 3,516 $87,900 0.4224 4 ,259 0.7084 $1 ,026 S 1,448 1,082 $11,248 37 129 $48,377 6 $1 ,665 ,915 0.5963 $1,142 $1,915 $2,202 $1 ,204 8 $2,202 15% $2,532 OfJ019 $1,271 9 32,532 $2,912 0.4604 $1 ,341 10 $2,912 $3,349 0 4224 $1,415 Discount factor at end Of year 10 (multiply) Present of Residual Market Value Of Company Notes: ASsumed first-stage growth rate 15.0%; assumed second-stage growth rate = 5.0%; k discount rate = 9 0% Dollar amounts are in millions.