Williams Company is a manufacturer of auto parts having the following financial statements for 2018-2019. Cash Accounts receivable Inventory Total current assets Long-lived assets Total assets Current liabilities Long-term debt Shareholders' equity Total debt and equity Balance Sheet December 31 2019 $ 276, 000 166, 000 401, 000 $ 843,000 1,800,000 $2,643, 000 392, 000 900,000 1, 351, 000 $2,643,000 2018 $ 151, 000 241, 000 191, 000 $ 583, 000 1,660,000 $2, 243,000 335, 000 960,000 948, 000 $2, 243,000 2 Income Statement For the years ended December 31 2019 Sales $3, 660, 000 Cost of sales 2, 820, 000 Gross margin 840,000 Operating expenses* 516, 000 Operating income 324, 000 Taxes 113, 400 Net income $ 210, 600 2018 $3,760, 000 , 920,000 840,000 274, 000 566, 000 198, 100 $ 367, 900 Cash Flow from Operations $ 2018 367, 900 130,000 Net income Plus depreciation expense + Decrease (-increase) in accounts receivable and inventory + Increase (-decrease) in current liabilities Cash flow from operations 2019 $ 210, 600 140,000 (135, 000) 57,000 $ 272, 600 $ 497, 900 * Operating expenses include depreciation expense. Additional financial information, including industry averages for 2019, where appropriate, includes: Industry 2019 35. 0% 2019 $ 170,000 35% $ 140,000 $ 34, 000 $ 3.85 1,960,000 2018 $ 260,000 35% $ 130,000 $ 34,000 $ 4 1,960,000 25.00 1.50 18.00 9.00 Capital expenditures Income tax rate Depreciation expense Dividends Year-end stock price Number of outstanding shares Sales multiplier Free cash flow multiplier Earnings multiplier Cost of capital Accounts receivable turnover Inventory turnover Current ratio Quick ratio Cash flow from operations ratio Free cash flow ratio Gross margin percentage Return on assets (net book value) Return on equity 5% 11.10 10.50 2.30 1.90 1.20 1. 10 30.0% 20.0% 30.0% Required: Develop a business valuation for Williams Company for 2019 using the following methods: (1) book value of equity, (2) market value of equity, (3) discounted cash flow (DCF), (4) enterprise value, and (5) all the multiples-based valuations for which there is an industry average multiplier. For the calculation of the DCF valuation, you may use the simplifying assumption that free cash flows will continue indefinitely at the amount in 2019. Book value of equity Market value of equity Discounted free cash flows Enterprise value Multiples-based valuation Earnings multiple Free cash flow multiple Sales multiple