hii

i calculated NPV.. please check if i did it correct and if it is negative,,

thanks ;)

Flash Memory, Inc. Exhibit 1 Income Statements, 2007 - 2012 ($000s except earnings per share) 2007 2008 2009 2010 2011 2012 Net sales Cost of goods sold Gross margin $77,131 $62,519 $14,612 $80,953 $68,382 $12,571 $89,250 $72,424 $16,826 $120,000 $97,320 $22,680 $144,000 $116,784 $27,216 $144,000 $116,784 $27,216 Research and development Selling, general and administrative Operating income $3,726 $6,594 $4,292 $4,133 $7,536 $902 $4,416 $7,458 $4,952 $6,000 $10,032 $6,648 $7,200 $12,038 $7,978 $7,200 $12,038 $7,978 $480 -$39 $652 -$27 $735 -$35 $216 -$50 $319 -$50 $479 -$50 Income before income taxes $3,773 $223 $4,182 $6,382 $7,608 $7,449 Income taxes (a) Net income $1,509 $2,264 $89 $134 $1,673 $2,509 $2,553 $3,829 $3,043 $4,565 $2,980 $4,469 Earnings per share $1.52 $0.09 $1.68 $2.57 $3.06 $3.00 Interest expense Other income (expenses) (a) In years 2007 and after, Flash's effective combined federal and state income tax rate was 40%. Flash Memory, Inc. Exhibit 2 Balance Sheets, 2007 - 2012 ($000s except number of shares outstanding) 2007 Cash Accounts receivable Inventories Prepaid expenses Total current assets December 31, 2009 2010 2008 2011 2012 $2,536 $10,988 $9,592 $309 $23,425 $2,218 $12,864 $11,072 $324 $26,478 $2,934 $14,671 $11,509 $357 $29,471 $3,960 $19,726 $13,865 $480 $38,031 $4,752 $23,671 $16,638 $576 $45,637 $4,752 $23,671 $16,638 $576 $45,637 $5,306 $792 $4,514 $6,116 $1,174 $4,942 $7,282 $1,633 $5,649 $8,182 $2,179 $6,003 $9,082 $2,793 $6,289 $9,982 $3,474 $6,508 $27,939 $31,420 $35,120 $44,034 $51,926 $52,145 Accounts payable Notes payable (a) Accrued expenses Income taxes payable (b) Other current liabilities Total current liabilities $3,084 $6,620 $563 $151 $478 $10,896 $4,268 $8,873 $591 $9 $502 $14,243 $3,929 $10,132 $652 $167 $554 $15,434 $4,799 $13,808 $876 $255 $744 $20,483 $5,759 $16,570 $1,051 $304 $893 $24,577 $5,759 $16,570 $1,051 $298 $893 $24,571 Common stock at par value Paid in capital in excess of par value Retained earnings Total shareholders' equity $15 $7,980 $9,048 $17,043 $15 $7,980 $9,182 $17,177 $15 $7,980 $11,691 $19,686 $15 $7,980 $15,520 $23,515 $15 $7,980 $20,085 $28,080 $15 $7,980 $24,555 $32,550 Total liabilities & shareholders' equity $27,939 $31,420 $35,120 $43,998 $52,658 $57,121 1,491,662 1,491,662 1,491,662 1,491,662 1,491,662 1,491,662 Property, plant & equipment at cost Less: Accumulated depreciation Net property, plant & equipment Total assets Number of shares outstanding (a) Secured by accounts receivable. (b) To avoid a penalty for underpayment of income taxes, Flash made equal estimated tax payments quarterly on the 15th of April, June, September, and December of each year. The total of these four quarterly payments was required to equal at least the lesser of (a) 90% of the taxes that would actually be incurred in the same year, or (b) 100% of the taxes due on income of the prior year. For informational purposes only: Notes payable / accounts receivable Notes payable / shareholders' equity Notes payable / total capital 60.2% 38.8% 28.0% 69.0% 51.7% 34.1% 69.1% 51.5% 34.0% New plants and equipment Net sales Cost of goods sold Selling, general and administrative Advertising Exepense EBIT Tax Dep OCF net working capital for each year Change in Net working capital Net OCF $ $ $ $ $ $ $ $ $ 2010 (2,200,000.00) - $ $ $ (5,648,400.00) $ (7,848,400.00) $ NPV Research and development (sunk cost) ($2,660,528.10) $ 400,000.00 2011 2012 $ 21,600,000.00 $ 28,000,000.00 $ (17,064,000.00) $ (22,120,000.00) $ (1,804,961.34) $ (2,339,764.71) $ (30,000.00) $ $ 2,701,038.66 $ 3,540,235.29 $ (1,080,415.46) $ (1,416,094.12) $ 440,000.00 $ 440,000.00 $ 2,060,623.19 $ 2,564,141.18 5,648,400.00 $ (1,673,600.00) $ 387,023.19 $ 7,322,000.00 2,564,141.18 2013 2014 2015 $ 28,000,000.00 $ 11,000,000.00 $ 5,000,000.00 $ (22,120,000.00) $ (8,690,000.00) $ (3,950,000.00) $ (2,339,764.71) $ (919,193.28) $ (417,815.13) $ ### $ $ 3,540,235.29 $ 1,390,806.72 $ 632,184.87 $ (1,416,094.12) $ (556,322.69) $ (252,873.95) $ 440,000.00 $ 440,000.00 $ 440,000.00 $ 2,564,141.18 $ 1,274,484.03 $ 819,310.92 $ $ $ 7,322,000.00 $ 4,445,500.00 $ 7,009,641.18 $ 2,876,500.00 $ 1,569,000.00 $ 2,843,484.03 $ 1,307,500.00 1,307,500.00 2,126,810.92 SGA in 2009 0.08356 \fFlash Memory, Inc. Exhibit 1 Income Statements, 2007 - 2012 ($000s except earnings per share) 2007 2008 2009 2010 2011 2012 Net sales Cost of goods sold Gross margin $77,131 $62,519 $14,612 $80,953 $68,382 $12,571 $89,250 $72,424 $16,826 $120,000 $97,320 $22,680 $144,000 $116,784 $27,216 $144,000 $116,784 $27,216 Research and development Selling, general and administrative Operating income $3,726 $6,594 $4,292 $4,133 $7,536 $902 $4,416 $7,458 $4,952 $6,000 $10,032 $6,648 $7,200 $12,038 $7,978 $7,200 $12,038 $7,978 $480 -$39 $652 -$27 $735 -$35 $216 -$50 $319 -$50 $479 -$50 Income before income taxes $3,773 $223 $4,182 $6,382 $7,608 $7,449 Income taxes (a) Net income $1,509 $2,264 $89 $134 $1,673 $2,509 $2,553 $3,829 $3,043 $4,565 $2,980 $4,469 Earnings per share $1.52 $0.09 $1.68 $2.57 $3.06 $3.00 Interest expense Other income (expenses) (a) In years 2007 and after, Flash's effective combined federal and state income tax rate was 40%. Flash Memory, Inc. Exhibit 2 Balance Sheets, 2007 - 2012 ($000s except number of shares outstanding) 2007 Cash Accounts receivable Inventories Prepaid expenses Total current assets December 31, 2009 2010 2008 2011 2012 $2,536 $10,988 $9,592 $309 $23,425 $2,218 $12,864 $11,072 $324 $26,478 $2,934 $14,671 $11,509 $357 $29,471 $3,960 $19,726 $13,865 $480 $38,031 $4,752 $23,671 $16,638 $576 $45,637 $4,752 $23,671 $16,638 $576 $45,637 $5,306 $792 $4,514 $6,116 $1,174 $4,942 $7,282 $1,633 $5,649 $8,182 $2,179 $6,003 $9,082 $2,793 $6,289 $9,982 $3,474 $6,508 $27,939 $31,420 $35,120 $44,034 $51,926 $52,145 Accounts payable Notes payable (a) Accrued expenses Income taxes payable (b) Other current liabilities Total current liabilities $3,084 $6,620 $563 $151 $478 $10,896 $4,268 $8,873 $591 $9 $502 $14,243 $3,929 $10,132 $652 $167 $554 $15,434 $4,799 $13,808 $876 $255 $744 $20,483 $5,759 $16,570 $1,051 $304 $893 $24,577 $5,759 $16,570 $1,051 $298 $893 $24,571 Common stock at par value Paid in capital in excess of par value Retained earnings Total shareholders' equity $15 $7,980 $9,048 $17,043 $15 $7,980 $9,182 $17,177 $15 $7,980 $11,691 $19,686 $15 $7,980 $15,520 $23,515 $15 $7,980 $20,085 $28,080 $15 $7,980 $24,555 $32,550 Total liabilities & shareholders' equity $27,939 $31,420 $35,120 $43,998 $52,658 $57,121 1,491,662 1,491,662 1,491,662 1,491,662 1,491,662 1,491,662 Property, plant & equipment at cost Less: Accumulated depreciation Net property, plant & equipment Total assets Number of shares outstanding (a) Secured by accounts receivable. (b) To avoid a penalty for underpayment of income taxes, Flash made equal estimated tax payments quarterly on the 15th of April, June, September, and December of each year. The total of these four quarterly payments was required to equal at least the lesser of (a) 90% of the taxes that would actually be incurred in the same year, or (b) 100% of the taxes due on income of the prior year. For informational purposes only: Notes payable / accounts receivable Notes payable / shareholders' equity Notes payable / total capital 60.2% 38.8% 28.0% 69.0% 51.7% 34.1% 69.1% 51.5% 34.0% New plants and equipment Net sales Cost of goods sold Selling, general and administrative Advertising Exepense EBIT Tax Dep OCF net working capital for each year Change in Net working capital Net OCF NPV Research and development (sunk cost) $ $ $ $ $ $ $ $ $ 2010 (2,200,000.00) - $ $ 5648400 $ (5,648,400.00) $ (7,848,400.00) $ $2,996,781.61 $400,000.00 2011 2012 $ 21,600,000.00 $ 28,000,000.00 $ (17,064,000.00) $ (22,120,000.00) $ (1,804,961.34) $ (2,339,764.71) $ (30,000.00) $ $ 2,701,038.66 $ 3,540,235.29 $ (1,080,415.46) $ (1,416,094.12) $ 440,000.00 $ 440,000.00 $ 2,060,623.19 $ 2,564,141.18 7,322,000.00 $ (1,673,600.00) $ 387,023.19 $ 7,322,000.00 2,564,141.18 2013 2014 2015 $ 28,000,000.00 $ 11,000,000.00 $ 5,000,000.00 $ (22,120,000.00) $ (8,690,000.00) $ (3,950,000.00) $ (2,339,764.71) $ (919,193.28) $ (417,815.13) $ ### $ $ 3,540,235.29 $ 1,390,806.72 $ 632,184.87 $ (1,416,094.12) $ (556,322.69) $ (252,873.95) $ 440,000.00 $ 440,000.00 $ 440,000.00 $ 2,564,141.18 $ 1,274,484.03 $ 819,310.92 $ $ $ 2,876,500.00 $ 4,445,500.00 $ 7,009,641.18 $ 1,307,500.00 $ 1,569,000.00 $ 2,843,484.03 $ 1,307,500.00 2,126,810.92 SGA in 2009 0.08356 Micron Technology SanDisk Corporation STEC, Inc. Average beta 1.25 1.36 1 1.20 10- year Treasury bond Market risk premium Target debt to captial D/E 3.70% 6% 18% 0.15 Prime rate Prime plus Cost of debt Tax rate 3.25% 6% 9.25% 40% Levered beta Cost of equity After tax cost of debt WACC 1.313469 11.58% 5.55% 10.50% \fFlash Memory, Inc. Exhibit 1 Income Statements, 2007 - 2012 ($000s except earnings per share) 2007 2008 2009 2010 2011 2012 Net sales Cost of goods sold Gross margin $77,131 $62,519 $14,612 $80,953 $68,382 $12,571 $89,250 $72,424 $16,826 $120,000 $97,320 $22,680 $144,000 $116,784 $27,216 $144,000 $116,784 $27,216 Research and development Selling, general and administrative Operating income $3,726 $6,594 $4,292 $4,133 $7,536 $902 $4,416 $7,458 $4,952 $6,000 $10,032 $6,648 $7,200 $12,038 $7,978 $7,200 $12,038 $7,978 $480 -$39 $652 -$27 $735 -$35 $216 -$50 $319 -$50 $479 -$50 Income before income taxes $3,773 $223 $4,182 $6,382 $7,608 $7,449 Income taxes (a) Net income $1,509 $2,264 $89 $134 $1,673 $2,509 $2,553 $3,829 $3,043 $4,565 $2,980 $4,469 Earnings per share $1.52 $0.09 $1.68 $2.57 $3.06 $3.00 Interest expense Other income (expenses) (a) In years 2007 and after, Flash's effective combined federal and state income tax rate was 40%. Flash Memory, Inc. Exhibit 2 Balance Sheets, 2007 - 2012 ($000s except number of shares outstanding) 2007 Cash Accounts receivable Inventories Prepaid expenses Total current assets December 31, 2009 2010 2008 2011 2012 $2,536 $10,988 $9,592 $309 $23,425 $2,218 $12,864 $11,072 $324 $26,478 $2,934 $14,671 $11,509 $357 $29,471 $3,960 $19,726 $13,865 $480 $38,031 $4,752 $23,671 $16,638 $576 $45,637 $4,752 $23,671 $16,638 $576 $45,637 $5,306 $792 $4,514 $6,116 $1,174 $4,942 $7,282 $1,633 $5,649 $8,182 $2,179 $6,003 $9,082 $2,793 $6,289 $9,982 $3,474 $6,508 $27,939 $31,420 $35,120 $44,034 $51,926 $52,145 Accounts payable Notes payable (a) Accrued expenses Income taxes payable (b) Other current liabilities Total current liabilities $3,084 $6,620 $563 $151 $478 $10,896 $4,268 $8,873 $591 $9 $502 $14,243 $3,929 $10,132 $652 $167 $554 $15,434 $4,799 $13,808 $876 $255 $744 $20,483 $5,759 $16,570 $1,051 $304 $893 $24,577 $5,759 $16,570 $1,051 $298 $893 $24,571 Common stock at par value Paid in capital in excess of par value Retained earnings Total shareholders' equity $15 $7,980 $9,048 $17,043 $15 $7,980 $9,182 $17,177 $15 $7,980 $11,691 $19,686 $15 $7,980 $15,520 $23,515 $15 $7,980 $20,085 $28,080 $15 $7,980 $24,555 $32,550 Total liabilities & shareholders' equity $27,939 $31,420 $35,120 $43,998 $52,658 $57,121 1,491,662 1,491,662 1,491,662 1,491,662 1,491,662 1,491,662 Property, plant & equipment at cost Less: Accumulated depreciation Net property, plant & equipment Total assets Number of shares outstanding (a) Secured by accounts receivable. (b) To avoid a penalty for underpayment of income taxes, Flash made equal estimated tax payments quarterly on the 15th of April, June, September, and December of each year. The total of these four quarterly payments was required to equal at least the lesser of (a) 90% of the taxes that would actually be incurred in the same year, or (b) 100% of the taxes due on income of the prior year. For informational purposes only: Notes payable / accounts receivable Notes payable / shareholders' equity Notes payable / total capital 60.2% 38.8% 28.0% 69.0% 51.7% 34.1% 69.1% 51.5% 34.0% New plants and equipment Net sales Cost of goods sold Selling, general and administrative Advertising Exepense EBIT Tax Dep OCF net working capital for each year Change in Net working capital Net OCF NPV Research and development (sunk cost) $ $ $ $ $ $ $ $ $ 2010 (2,200,000.00) - $ $ 5648400 $ (5,648,400.00) $ (7,848,400.00) $ $2,996,781.61 $400,000.00 2011 2012 $ 21,600,000.00 $ 28,000,000.00 $ (17,064,000.00) $ (22,120,000.00) $ (1,804,961.34) $ (2,339,764.71) $ (30,000.00) $ $ 2,701,038.66 $ 3,540,235.29 $ (1,080,415.46) $ (1,416,094.12) $ 440,000.00 $ 440,000.00 $ 2,060,623.19 $ 2,564,141.18 7,322,000.00 $ (1,673,600.00) $ 387,023.19 $ 7,322,000.00 2,564,141.18 2013 2014 2015 $ 28,000,000.00 $ 11,000,000.00 $ 5,000,000.00 $ (22,120,000.00) $ (8,690,000.00) $ (3,950,000.00) $ (2,339,764.71) $ (919,193.28) $ (417,815.13) $ ### $ $ 3,540,235.29 $ 1,390,806.72 $ 632,184.87 $ (1,416,094.12) $ (556,322.69) $ (252,873.95) $ 440,000.00 $ 440,000.00 $ 440,000.00 $ 2,564,141.18 $ 1,274,484.03 $ 819,310.92 $ $ $ 2,876,500.00 $ 4,445,500.00 $ 7,009,641.18 $ 1,307,500.00 $ 1,569,000.00 $ 2,843,484.03 $ 1,307,500.00 2,126,810.92 SGA in 2009 0.08356 Micron Technology SanDisk Corporation STEC, Inc. Average beta 1.25 1.36 1 1.20 10- year Treasury bond Market risk premium Target debt to captial D/E 3.70% 6% 18% 0.15 Prime rate Prime plus Cost of debt Tax rate 3.25% 6% 9.25% 40% Levered beta Cost of equity After tax cost of debt WACC 1.313469 11.58% 5.55% 10.50%