1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
marissa [1.9K]
3 years ago
7

Edelman Engines has $5 billion in total assets — of which cash and equivalents total $90 million. Its balance sheet shows $1 bil

lion in current liabilities — of which the notes payable balance totals $1.04 billion. The firm also has $3.25 billion in long-term debt and $0.75 billion in common equity. It has 300 million shares of common stock outstanding, and its stock price is $24 per share. The firm's EBITDA totals $1.08 billion. Assume the firm's debt is priced at par, so the market value of its debt equals its book value. What are Edelman's market/book and its EV/EBITDA ratios? Do not round intermediate calculations. Round your answers to two decimal places.
Business
1 answer:
masha68 [24]3 years ago
5 0

Answer:

Edelman's market/book = 2.29

Edelman's EV/EBITDA = 10.52

Explanation:

Firstly, we need to calculate enterprise value (EV) & fiem value (FV) of Edelman Engines as below:

EV =  Market value of equity + Net market value of debt

     = Stock price x Number of share outstanding + (Debt - Cash)

     = 24 x 0.3 + (3.25 + 1 - 0.09) = 11.36

FV = Market value of equity + Market value of debt

     = Stock price x Number of share outstanding + Market value of debt

     = 24 x 0.3 + 3.25 + 1 = 11.45

Edelman's market/book = FV/Total asset = 11.45/5 = 2.29

Edelman's EV/EBITDA = 11.36/1.08 = 10.52

You might be interested in
At the end of the prior year, Doubtful Inc. had a deferred tax asset of $18,500,000 attributable to its only timing difference,
iren [92.7K]

Answer:

Journal entries to record Doubtful's income tax expense for the current year.

No   Account titles and Explanation             Debit'$    Credit'$

1       Income tax expense                             8,945,000

                  Deferred tax asset                                     3,800,000

                  [(42,000,000*35%) - 18,500,000]

                   Income taxes payable                               5,145,000

                   [(14,700,000*35%)]

         (To record tax expenses)

2        Income tax expense                            1,270,000

                 Valuation allowance - deferred tax asset  1,270,000

                   (3,730,000 - 5,000,000

          (To record valuation allowance)

7 0
3 years ago
Gross pay minus deductions is known as take home pay.<br><br> True<br> False
IceJOKER [234]
Gross pay minus deductions<span>. Also </span>called take-home pay<span>. A special checking account used to </span>pay<span> a company's employees. A manual or computerized schedule prepared for each payroll period listing the earnings, </span>deductions<span>, and net </span>pay<span> for each employee.

Hopes this information helps

</span>
6 0
3 years ago
Digital photography replacing film photography would be an example of a(n) _____. Group of answer choices radical innovation reg
Ratling [72]

Answer:

disruptive innovation.

Explanation:

A disruptive innovation can be defined as an innovation that typically creates a new market for a product by displacing or removing an existing product from the market.

Digital photography replacing film photography would be an example of a disruptive innovation.

4 0
3 years ago
You currently own 100 shares of stock in Beverly Brothers Inc. The stock currently trades at $120 a share. The company is contem
Gwar [14]

Answer:

No option is correct, since you will have 200 shares and each share should be worth around $60.

Explanation:

If the 2-for-1 stock split takes place then you will have 200 shares instead of 100. For every 1 share that you currently own, the corporation will issue another share.

Since the price of the shares was $120 before the stock split, after the stock split the price will be divided by two (the same proportion). So each new share will cost approximately $60.

In order for option 2 to be correct, the stock spit should have been 3-for-1.

8 0
3 years ago
Which of the following is an example of a real estate investment?
velikii [3]
What is the following may I ask? You can invest in real estate by either buying a property or buying into a real estate investment fund.
5 0
3 years ago
Other questions:
  • What are five basic principles found in a free enterprise system?
    6·1 answer
  • Matt, a blind man in his early twenties, was recently hired as a DJ at a local radio station in Orlando. He was given permission
    10·2 answers
  • Wassup who tryna talk
    5·1 answer
  • This program will store roster and rating information for a soccer team. coaches rate players during tryouts to ensure a balance
    9·1 answer
  • Armour, Inc., an advertising agency, applies overhead to jobs on the basis of direct professional labor hours. Overhead was esti
    13·1 answer
  • Software Distributors reports net income of $58,000. Included in that number is depreciation expense of $11,500 and a loss on th
    14·1 answer
  • Common stock with a total par value of $50,000 (par value of $0.50 per share) have been issued, and 5,000 shares of treasury sto
    7·1 answer
  • Please help me with personal finance!!! NO LINKS!!!
    9·1 answer
  • Value a Constant Growth Stock Financial analysts forecast Best Buy Company (BBY) growth for the future to be 14.00 percent. Thei
    14·1 answer
  • The rule in Garner v. Murray deals with​
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!