Question
You have been provided the following actual financial information from the reformulated 2021 financial statements of Golden Ltd. and forecasts of the same figures for
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You have been provided the following actual financial information from the reformulated 2021 financial statements of Golden Ltd. and forecasts of the same figures for the 3-year period 2022 2024.
2021 A
2022 E
2023 E
2024 E
Sales Revenue
2,000,000
1,900,000
1,800,000
1,750,000
Operating Profit Margin (PM)
0.15
0.125
0.11
0.10
Asset Turnover (ATO)
2
2
2
2
Based on this information, which of the following statements is TRUE assuming that the firms weighted average cost of capital is 12% and the forecasted growth rate in the firms free cash flows (FCF) after 2024 is 1%?
1. The firms expected free cash flows (FCF) for 2024 are $176,250 and the estimated value of the firm based on the discounted FCF valuation model is $653,103
2. The firms expected free cash flows (FCF) for 2024 are $200,000 and the estimated value of the firm based on the discounted FCF valuation model is $653,103
3. The firms expected free cash flows (FCF) for 2024 are $150,000 and the estimated value of the firm based on the discounted FCF valuation model is $1,372,478
4. The firms expected free cash flows (FCF) for 2024 are $200,000 and the estimated value of the firm based on the discounted FCF valuation model is $1,903,844
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Financial Literacy For Young Adults Simplified Discover How To Manage Save And Invest Money To Build A Secure And Independent Future
Authors: Raman Keane
1st Edition
8399806501, 979-8399806501
