Business, 26.07.2019 01:40 jesspatrick91810
P7-16: free cash flow valuation you are evaluating the potential purchase of a small business with no debt or preferred stock that is currently generating $42,500 of free cash flow (fcf 0=$42,500). on the basis of a review of similar-risk invest-ment opportunities, you must earn an 18% rate of return on the proposed purchase. because you are relatively uncertain about future cash flows, you decide to estimate the firm’s value using several possible assumptions about the growth rate of cash flows. a. what is the firm’s value if cash flows are expected to grow at an annual rate of 0% from now to infinity
Answers: 2
Business, 21.06.2019 18:10
Classifying inflows and outflows of cash classify each of the following items as an inflow (i) or an outflow (o) of cash, or as neither (n). lg 2 lg 2 item change ($) item change ($) cash +100 accounts receivable −700 accounts payable −1,000 net profits +600 notes payable +500 depreciation +100 long-term debt −2,000 repurchase of stock +600 inventory +200 cash dividends +800 fixed assets +400 sale of stock +1,000
Answers: 1
Business, 22.06.2019 20:20
An economic theory that calls for workers to take control of factories is .
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Business, 22.06.2019 20:30
When many scrum teams are working on the same product, should all of their increments be integrated every sprint?
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Business, 22.06.2019 21:40
Western electric has 32,000 shares of common stock outstanding at a price per share of $79 and a rate of return of 13.00 percent. the firm has 7,300 shares of 7.80 percent preferred stock outstanding at a price of $95.00 per share. the preferred stock has a par value of $100. the outstanding debt has a total face value of $404,000 and currently sells for 111 percent of face. the yield to maturity on the debt is 8.08 percent. what is the firm's weighted average cost of capital if the tax rate is 39 percent?
Answers: 2
P7-16: free cash flow valuation you are evaluating the potential purchase of a small business with...
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