Valuation of Winter Sports Inc Winter Sports Inc. has the following Balance Sheet and Income Statement for 2020. Accounts Payable Note Payable $10,000 5,000 Cash Marketable Securities Accounts receivable Inventories Total Current Assets $ 1,000 5,000 12,000 14,000 $32,000 Total Liabilities $15,000 Equipment (cost $30,000) 16,000 Common Stocks Retained Earnings Total 3,000 90,000 $108,000 Total $108,000 2020 Sales COGS Gross Profit $200,000 100,000 100,000 Operating expenses Depreciation Interest Expense Total Expenses 72,000 2,000 1.000 75,000 Income before Taxes Income Taxes (40%) Net Income 25,000 10,000 $15,000 Other information: The business does not have a business cycle - 2020 is an average year. The President (shareholder) has been paid a salary of $40,000 but the market-rate for his services would have been $50,000. Marketable Securities are surplus cash in excess of operational needs (FMV $5,000) Expected capital expenditures required in order to sustain operations is estimated to be $2,000 per year. CCA rate on capital assets acquired is 30% The Undepreciated Capital Cost (UCC) balance on the existing assets is $20,000 and the CCA rate is 30%. Company tax rate is 40%. Capital Gains are taxed at 50% and no capital losses allowed on depreciable property. WACC rate is 15%. Based on Company's growth prospects, economic and market conditions, capitalization rate is judged to be 12% . Required: Assume the business will continue as a going concern, what is its Equity Value using the Capitalized Cash Flow method? Normalized EBITDA: $ of Income Taxes: $ Junghan SOI Sustaining Capital Investments: $ f PV of CCA Tax Shield on sustaining capital investments: $ Normalized Discretionary Cash Flow: $ Junghan son Capitalized Cash Flow: $ Jestion 27 PV of CCA Tax Shield on Existing Assets: $ ot yet swered arked out of 00 Flag estion uestion 28 Liabilities: $ ot yet swered arked out of DO tion 29 Redundant Assets: $ et ered ed out of ag on on 30 Business Equity Value: $ t red out of