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Using the financial statements of that firm estimate its value if the Assets to Sales ratio is not 1.00. but 1.20. Firm 2 ($million) Current

Using the financial statements of that firm estimate its value if the Assets to Sales ratio is not 1.00. but 1.20.

Firm	2		($million)
Current sales ($M)	78.677
Disc.Rate	8%
Term (years)	Unlimited
g (1 to 5)	15%
g (6-10)	0%

Market value	119.231
Assets/Sales	1.00
Net_Inc/Sales	10.00%
Equity/Assets	0.80
		0	1
Sales
Assets
Equity
Net income
Inv. in assets Eq. funded
FCF before Term.Val
Terminal Value
FCF
Value of equity

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