Name 1 (10 points) The following represents the target's accounting data you have estimated for the years 2020-2021. Assume that all of these numbers are end-of-year data (ie, today is January 1st 2020 and the revenues, etc. are at the end of 2020 2021). In addition, you have the following information for the target and the acquiring firm. 2020 2021 Revenues $9,000,000 $13.000.000 Cost of Goods Sold $4,500,000 $8.000.000 Depreciation $1,000.000 $1,200,000 A&G $1,200,000 $900.000 Interest $750,000 $800,000 Retained Earnings $600,000 $800,000 Target Acquiring Firm Calculate the appropriate cash flows. Cap Structure: Debt-50% Calculate the appropriate discount rate for the Taxes 30 Taxes = 54% acquiring firm based on the value of the target. Calculate the target firm value. What would be a Cap Structure: Debt = 30% #of Shares Outstanding +800.000 Other Information reasonable offer (Le. $/share) for the target. Current Price per Share - $18 T-bond rate=6% Est. Future Growth Rate = 8% Mit Rask Premium + 5% B-L8 Name 1 (10 points) The following represents the target's accounting data you have estimated for the years 2020-2021. Assume that all of these numbers are end-of-year data (ie, today is January 1st 2020 and the revenues, etc. are at the end of 2020 2021). In addition, you have the following information for the target and the acquiring firm. 2020 2021 Revenues $9,000,000 $13.000.000 Cost of Goods Sold $4,500,000 $8.000.000 Depreciation $1,000.000 $1,200,000 A&G $1,200,000 $900.000 Interest $750,000 $800,000 Retained Earnings $600,000 $800,000 Target Acquiring Firm Calculate the appropriate cash flows. Cap Structure: Debt-50% Calculate the appropriate discount rate for the Taxes 30 Taxes = 54% acquiring firm based on the value of the target. Calculate the target firm value. What would be a Cap Structure: Debt = 30% #of Shares Outstanding +800.000 Other Information reasonable offer (Le. $/share) for the target. Current Price per Share - $18 T-bond rate=6% Est. Future Growth Rate = 8% Mit Rask Premium + 5% B-L8