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Micheal Jr. Company has provided the following data for their finances in the following 2 years, from this data, prepare the following (assume tax rate
Micheal Jr. Company has provided the following data for their finances in the following 2 years, from this data, prepare the following
(assume tax rate is 35%. Capital expenditures for both years are equal to 5% of sales. Depreciation for all years is 3% of sales, and change in net working capital of the company is 1% of sales for every year)
Projected cash flows
Terminal value
Net cash flow
Discounted cash flows (assume a 25% discount rate)
Finally, determine the total present value of the Micheal Jr. company
Income Statements | 2013 | 2014 |
Revenue | 41,777,645 | 47,732,291 |
Cost of sale (with Depreciation) | (18,673,898) | (22,815,286) |
Operating costs | (5,161,746) | (5,434,879) |
General Admin. Costs | (1,049,938) | (1,209,991) |
New employments | (1,577,676) | (1,777,111) |
Marketing and advertising | (3,377,127) | (3,924,781) |
Income (before taxes) | 11,937,260 | 12,570,243 |
Taxes | 4,178,041 | 4,399,585 |
Net Profit | 7,759,219 | 8,170,657 |
Show all your work clearly.
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