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G N At the beginning of the year 1, Down Under Company raises $60 million of equity and use the proceeds to buy a fixed asset. Operating profits before depreciation (all received in cash) and dividends for the company are expected to be $40 million in year 1,$50 million in year, and $60 million in year 3, ath which point the company terminates. The firm pays no taxes. Assuming stright line depreciation to oro fof 20 million per year)the firm's profits thus equal $20 in year 1, $30 1 million in yox 2 and $40 milion in year 3. If the cost of equity is 6, the value of the Arms equityis 2 3 10 Points Use the Discounted Dividend Valuation Method 4 5 7 8 9 10 12 13 14 15 16 17 18 19 20 (10 Point Use the Abnormalnire Valuation Method 21 Hit: Book Value per year is affected by the 20 million every ye 22 23 24 25 26 27 28 Valuation + Ready Download the Excel file (Valtion students and use the space provided in yellow. At the beginning of the year 1. Down Under Company rate 60 milion of equity and use the proceeds to buy a fixed met Operating profits before depreciation all received in cash and dividends for the company are expected to be $10 million in year 1, $50 milion in year 2, and 360 milion in your wth which point the company terminator. The firm pays no tanes. Assuming wright Ine depreciation to ero of 20 million per year the fem profits thus w $20 in yow 1530 million yew and milion in your the cost of culty is 6%, the value of the time equity Use the Discounted Dividend Valuation Method Use the Abnormal Earnings Valuation Method At the beginning of the year 1, Down Under Company raises $60 milion of equity and uses the proceeds to buy a fixed asset. Operating profits before depreciation (all received in cash and dividends for the company are expected to be 540 million in year 1, 550 million in year 2, and $60 million in year 3, ath which point the company terminates. The firms pays no taxes. Assuming stright line depreciation to zero (of 20 million per year, the firm's profits thus equal $20 in year 1, $30 1 million in year 2 and $40 milion in year 3. If the cost of equity is 6%, the value of the firms equity is: 3 (10 Palnts) Use the Discounted Dividend Valuation Method 2 6 7 9 10 11 12 13 14 15 16 17 18 19 20 (10 Points) Use the Abnormal Earnings Valuation Method 21 Hint: Book Value per year is affected by the 20 million every year 22 23 24 25 > $ Ax & for B C D Cash Flow Data Net income -Change in net working capital -Change in net long-term assets + Change in net debt ats) =Free cash flow to equity 20356.31 -23191.95 -127118.15 -85977.38 84689.03 Net operating profit after tax -Change in net working capital -change in net long term assets = Free cash flow to capital 21645.97 -23191.95 -127118.15 171956.07 Insert Draw Page Layout Formulas Share Com Calibri (Body! 11 X D 3 - ' ' a. Data Review View Tell me == General , S% Conditional Formatting Permatas Thie Cal Styles - 2:24. 0. O Olete- BTV fort Fiber Find Any Data x x D G Total (30 points). Pe complete the following the 2022 Forecast Year Sales growth rate OPAT margin Begoning net operating working sales Beginning net operating long term assets/ eginning net debt to captiaruto her tax cost of debt Beginning Balance Sheet Bing networking capital Begnet long terms net operating 2018 9.39 9.89 10 60% 58 10W 57.20N 1.SON 2019 831 10.49% 960 57 00N 57.20N 170 2020 8.43 11.09 8.809 55.70 57.20 190 2021 7 BON 10.SON BOON 55.70% 57.20N 2.10N GRON 9.30N 8.50N 55.70 57.205 2.30 2021 6.OON 9. BON RON 55.70% 57-20% 2.SON 2024 5.SON 8.70 360 55.70 57-20% 2.50% 2025 4 SON R10W 50 55.70 57.20 2.SON 2026 30% 7.60N 3.60 55 70% 37.205 2.50% 2027 3.COM 7.00 BON 55.70 57205 2501 2315195 12711315 150310.10 Beginning Balance Sheet Beg net working capital + Beg net long term assets = net operating assets 23191.95 127118.15 150310.10 Net Debt +Preferred stock (Assume zero for all the years) + Shareholders' equity = Net Capital 85977.38 0.00 64332.72 150310.10 Income Statement Sales Net operating profits after tax -Net interes expese after tax = Net Income Preferred dividends (Assume O for all the years) = Net Income to common 218792.00 21645.97 1289.66 20356.31 0.00 20356.31 Operating return on assets Return on common equity Book value of assets growth rate Book value of common equity growth rate Net operatin asset turnover 14.40% 31.64% 5.00% 5.00% 1.46 Cash Flow Data Net income -Change in net working capital -Change in net long-term assets + Change in net debt =Free cash flow to equity 20356.31 -23191.95 -127118.15 -85977.38 84689.03 recasting + G N At the beginning of the year 1, Down Under Company raises $60 million of equity and use the proceeds to buy a fixed asset. Operating profits before depreciation (all received in cash) and dividends for the company are expected to be $40 million in year 1,$50 million in year, and $60 million in year 3, ath which point the company terminates. The firm pays no taxes. Assuming stright line depreciation to oro fof 20 million per year)the firm's profits thus equal $20 in year 1, $30 1 million in yox 2 and $40 milion in year 3. If the cost of equity is 6, the value of the Arms equityis 2 3 10 Points Use the Discounted Dividend Valuation Method 4 5 7 8 9 10 12 13 14 15 16 17 18 19 20 (10 Point Use the Abnormalnire Valuation Method 21 Hit: Book Value per year is affected by the 20 million every ye 22 23 24 25 26 27 28 Valuation + Ready Download the Excel file (Valtion students and use the space provided in yellow. At the beginning of the year 1. Down Under Company rate 60 milion of equity and use the proceeds to buy a fixed met Operating profits before depreciation all received in cash and dividends for the company are expected to be $10 million in year 1, $50 milion in year 2, and 360 milion in your wth which point the company terminator. The firm pays no tanes. Assuming wright Ine depreciation to ero of 20 million per year the fem profits thus w $20 in yow 1530 million yew and milion in your the cost of culty is 6%, the value of the time equity Use the Discounted Dividend Valuation Method Use the Abnormal Earnings Valuation Method At the beginning of the year 1, Down Under Company raises $60 milion of equity and uses the proceeds to buy a fixed asset. Operating profits before depreciation (all received in cash and dividends for the company are expected to be 540 million in year 1, 550 million in year 2, and $60 million in year 3, ath which point the company terminates. The firms pays no taxes. Assuming stright line depreciation to zero (of 20 million per year, the firm's profits thus equal $20 in year 1, $30 1 million in year 2 and $40 milion in year 3. If the cost of equity is 6%, the value of the firms equity is: 3 (10 Palnts) Use the Discounted Dividend Valuation Method 2 6 7 9 10 11 12 13 14 15 16 17 18 19 20 (10 Points) Use the Abnormal Earnings Valuation Method 21 Hint: Book Value per year is affected by the 20 million every year 22 23 24 25 > $ Ax & for B C D Cash Flow Data Net income -Change in net working capital -Change in net long-term assets + Change in net debt ats) =Free cash flow to equity 20356.31 -23191.95 -127118.15 -85977.38 84689.03 Net operating profit after tax -Change in net working capital -change in net long term assets = Free cash flow to capital 21645.97 -23191.95 -127118.15 171956.07 Insert Draw Page Layout Formulas Share Com Calibri (Body! 11 X D 3 - ' ' a. Data Review View Tell me == General , S% Conditional Formatting Permatas Thie Cal Styles - 2:24. 0. O Olete- BTV fort Fiber Find Any Data x x D G Total (30 points). Pe complete the following the 2022 Forecast Year Sales growth rate OPAT margin Begoning net operating working sales Beginning net operating long term assets/ eginning net debt to captiaruto her tax cost of debt Beginning Balance Sheet Bing networking capital Begnet long terms net operating 2018 9.39 9.89 10 60% 58 10W 57.20N 1.SON 2019 831 10.49% 960 57 00N 57.20N 170 2020 8.43 11.09 8.809 55.70 57.20 190 2021 7 BON 10.SON BOON 55.70% 57.20N 2.10N GRON 9.30N 8.50N 55.70 57.205 2.30 2021 6.OON 9. BON RON 55.70% 57-20% 2.SON 2024 5.SON 8.70 360 55.70 57-20% 2.50% 2025 4 SON R10W 50 55.70 57.20 2.SON 2026 30% 7.60N 3.60 55 70% 37.205 2.50% 2027 3.COM 7.00 BON 55.70 57205 2501 2315195 12711315 150310.10 Beginning Balance Sheet Beg net working capital + Beg net long term assets = net operating assets 23191.95 127118.15 150310.10 Net Debt +Preferred stock (Assume zero for all the years) + Shareholders' equity = Net Capital 85977.38 0.00 64332.72 150310.10 Income Statement Sales Net operating profits after tax -Net interes expese after tax = Net Income Preferred dividends (Assume O for all the years) = Net Income to common 218792.00 21645.97 1289.66 20356.31 0.00 20356.31 Operating return on assets Return on common equity Book value of assets growth rate Book value of common equity growth rate Net operatin asset turnover 14.40% 31.64% 5.00% 5.00% 1.46 Cash Flow Data Net income -Change in net working capital -Change in net long-term assets + Change in net debt =Free cash flow to equity 20356.31 -23191.95 -127118.15 -85977.38 84689.03 recasting +