Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

I WOULD LIKE TO SEE THE CALCULATIONS TO LEARN........ALSO, WHEN YOU GIVE THE ANSWER PLEASE PERFORM THE CALCULATION TO CHECK IF IT MATCHES WITH THE

I WOULD LIKE TO SEE THE CALCULATIONS TO LEARN........ALSO, WHEN YOU GIVE THE ANSWER PLEASE PERFORM THE CALCULATION TO CHECK IF IT MATCHES WITH THE ANSWER BECAUSE THIS IS THE SECOND TIME ASKING THE SAME QUESTION IN WHICH THEY JUST PUT THE ANSWER BUT WHEN PERFORMING THE CALCULATION IT DOESNT MATCHES..........A company has a five year weighted average after tax cash flow of $125,000. It has been
determined the discount rate is 19%, short term expected growth is 11%, and long-term sustainable
growth is 3%. The analyst has also determined excess cash of $25,000. What is the value of the
company based on the capitalization of after tax cash flows?
a. $625,000
b. $657,895
c. $781,250
d. $909,090
ABC Company has projected the following cash flows:
Year 1: 85,000
Year 2: 105,000
Year 3: 109,000
Year 4: 115,000
The analyst has determined an appropriate discount rate is 26% and the long-term growth rate is
2%. What is the terminal value?
a.175,596
b.190,229
c.187,096
d.202,687
image text in transcribed

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Cost management a strategic approach

Authors: Edward J. Blocher, David E. Stout, Gary Cokins

5th edition

73526940, 978-0073526942

Students also viewed these Finance questions

Question

What courses does he/she teach?

Answered: 1 week ago