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Value Co expects to sell 100,000 units of its product in year 1 . From year 2 to year 4 , Value's sales volume is
Value Co expects to sell 100,000 units of its product in year 1 . From year 2 to year 4 , Value's sales volume is expected to increase by 5% each year. After year 4 , Value's sales volume will no longer grow. The selling price per unit is expected to be $20 in year 1 and Value Co is expected to increase its selling price by 2% each year thereafter. Value Co's EBIT margin is expected to be 50% of dollar sales. Value Co's depreciation expense is expected to be 15% of sales. Value Co's capital expenditures are expected to be 20% of sales up to year 4 and 15% of sales thereafter. Value Co's net working capital is $180,000 today and is expected to be 10% of sales in the future. Value Co's discount rate is 10% and its corporate tax rate is 30%. What is Value Co's firm value? (Round to the nearest dollar) None of the other answers is correct. $9,755,641 $9,623,814$9,315,746 $9,491,313
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