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
GrogVix [38]
3 years ago
7

Victoria Enterprises expects earnings before interest and taxes ​(EBIT​) next year of $ 1.3 million. Its depreciation and capita

l expenditures will both be $ 309 comma 000​, and it expects its capital expenditures to always equal its depreciation. Its working capital will increase by $ 53 comma 000 over the next year. Its tax rate is 35 %. If its WACC is 10 % and its FCFs are expected to increase at 6 % per year in​ perpetuity, what is its enterprise​ value?
Business
1 answer:
BigorU [14]3 years ago
7 0

Answer:

Enterprise value = $20.988 million

Explanation:

We calculate the FCFF first using the given information.

FCFF from EBIT = EBIT * ( 1 - Tax rate) + Depreciation - Working Capital increase - Capital expenditure

Thus, the FCFF for Victoria Enterprises is:

  • FCFF = 1.3 million * (1 - 0.35) + 0.309 million - 0.053 million - 0.309 million
  • FCFF = 0.792 million

Using the FCFF we calculate the firm value using constant growth model as,

Value = 0.792 * ( 1 + 0.06) / 0.10 - 0.06    = $20.988 million

You might be interested in
Chevron identified their desired outputs and then worked backward by examining the supporting processes. They used a holistic ap
Pepsi [2]

Answer:

BPR

Explanation:

In this scenario, Chevron identified their desired outputs and then worked backward by examining the supporting processes. They used a holistic approach that led the company to examine the interdependencies among processes used in different business units. This is a Business Process Reengineering (BPR) approach. It is a radical approach and process to redefining a business entity so as to enhance productivity.

7 0
3 years ago
Compute gross profit earned by the company for each of the four costing methods. For specific identification, the March 9 sale c
vova2212 [387]

Answer:

Gross profit earned by the company for each of the four costing methods = Subtraction of Total cost of goods sold from Total Sales

$48,322 - $30,651 = $17,671

Explanation:

Total sales = (330 x 87.4) + (200 x 97.4) = $48,322

Total cost of goods sold overweighted average method = $30,651

Subtract $48,322 from $30,651 to give $17,671 as the gross profit.

In the attached picture, Your will see average costs calculated and the inventory values for March 5, 9, 25, and 29.

4 0
3 years ago
Telstra, Australia's largest telecommunications and media company, has net revenue of more than $ 26 billion (Australian). Some
klasskru [66]

The items included in its recent annual consolidated Dividends statement of cash flows presented using the direct method are listed.

1. Receipts from customers ------------- Operating Activities (O)

2. Dividends paid ----------- Financing Activities (F)

3. Payment for share buyback --------- Financing Activities (F)

4. Proceeds from the sale of property, plant, and equipment ------  Investing Activities (I).

5. Repayments of borrowings ------- Financing Activities (F)

6. Income taxes paid  ------------ Operating Activities (O)

A dividend is a distribution of profits by means of a business enterprise to its shareholders. while a organization earns a profit or surplus, it is able to pay a percentage of the earnings as a dividend to shareholders. Any quantity now not dispensed is taken to be re-invested within the commercial enterprise.

Dividends are bills a business enterprise makes to share earnings with its stockholders. they're paid on an ordinary basis, and they're one of the methods investors earn a return from making an investment in stock.

Learn more about Dividends here:-brainly.com/question/25845157

#SPJ4

4 0
2 years ago
If closing costs of $1,400 are associated with the refinance of reduce the monthly payment fro m $980 to $870 refinance, it woul
Anna71 [15]

Answer:

time take = 13 months

so correct option is C.)13

Explanation:

given data

closing costs = $1,400

monthly payment reduce = $980 to $870

to find out

Time to cover cost

solution

we know here monthly payments after reduction will be

monthly payments = $980 - $870

monthly payments = $110

so

time taken is = \frac{closing\ costs}{monthly\ payments}  .........1

time taken is = \frac{1400}{110}

time take is = 12.727273

time take = 13 months

so correct option is C.)13

8 0
3 years ago
Romona Company expects its November sales to be 20​% higher than its October sales of $ 240 comma 000. All sales are on credit a
kotykmax [81]

Answer:

The cash balance on November 30 amounts to $155,700

Explanation:

Cash balance on November 30 = Beginning balance + Collection of cash from October sales + Collection of cash from November sales - Payments for October Purchases - Payments for November Purchases

where

Beginning balance is $13,700

Collection of cash from October sales =  October Sales × % amount collected

                                                                = $240,000 × 70%

                                                                = $168,000

Collection of cash from November sales =  November Sales × % amount collected

                                                                = $240,000 × 1.20 × 25%

                                                                = $72,000

Payments for October Purchases = October Purchases × % amount paid

                                                        = $70,000 × 65%

                                                        = $45,500

Payments for November Purchases = November Purchases × % amount paid

                                                        = $150,000 × 35%

                                                        = $52,500

Putting the values in the above formula

Cash balance on November 30 = $13,700 + $168,000 + $72,000 - $45,500 - $52,500

= $155,700

4 0
3 years ago
Other questions:
  • The minimum number of instances of entity b that may be associated with each instance of entity a defines the:
    14·1 answer
  • Which question is an illustration of a macroeconomic question? Multiple Choice a) Is a corporation unresponsive to the demands o
    9·1 answer
  • Why is it necessary to have a time-phased budget baseline? Select one: a. It allows proper resource allocation b. It reduces sch
    15·1 answer
  • Rachel is deciding whether to remain in the home she has lived in for the past ten years, which is located very near her work, o
    6·1 answer
  • Which of the following statements is​ false?A. In a​ make-to-order environment, the forecasts tend to be for groups of products.
    9·1 answer
  • Condensed financial data of Saffordville Company are shown below.
    13·2 answers
  • . Define corporate-level strategy. What are the different levels of diversification firms
    14·1 answer
  • PLEASE HELP VRO
    10·2 answers
  • The following transactions and adjusting entries were completed by a paper-packaging company called Gravure Graphics Internation
    7·1 answer
  • Khi nào bán hết 1 tỷ gói mè
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!