Use the following information to answer questions 9 - 14 Consider the following abbreviated financial statements for Pinghua: PINGHUA 2014 and 2015 Partial Balance Sheets Assets Liabilities and Owners' Equity 2014 2015 2014 2015 Current assets $ 1,850 $2,100 Current liabilities $ 740 $ 860 Net fixed 7,850 9,120 Long-term debt 4,000 4,300 assets Equity 4,960 6,060 PINGHUA PINGHUA 2015 Income Statement Info Sales $ 11,300 Costs 5,500 Depreciation 1,000 Interest paid 200 The tax rate is 35%. Long term debt trades at 112% of par. The firm has 500 shares outstanding, Free Cash Flow to the Firm and the Free Cash Flow to Equity are both expected to grow at 2% forever. The weighted average cost of capital is 16%. The cost of equity is 24%, Question 9 1 pts What is the Net Income for 2015? $ Hint: Construct the Income Stmt using the partial info. You are almost there, you just have to compute the taxable income and subtract the income tax. Question 10 1 pts What is the Free Cash Flow to the Firm for 20152 $ Hint: FCFF = ? = EBIT-Tax+D-chgNWC-Capex where Capex-chgNFA+D Question 11 1 pts What is the Value of the Firm (Assets)? $ Hint: FCFF / (WACC -g) Question 12 1 pts What is the stock price per share using the discounted FCFF valuation? $_ Hint: Take the previous answer, subtract the market value of Debt, that will produce the value of the Equity. Then divide by the number of shares. Question 13 1 pts What is the Free Cash Flow to Equity for 2015? $_ Hint: The easiest way is FCFE - FCFF - interest + chgDebt or follow the original FCFE equation Question 14 1 pts What is the stock price per share using the discounted FCFE valuation? $ Hint: FCFE/ (RE-g) gives you the value of Equity, then divide by the number of shares