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3 years ago

Heavy Metal Corporation is expected to generate the following free cash flows over the next five years.

Business

1 answer:

mezya [45]3 years ago

4 0

Answer:

Enterprise value of Heavy Metal= $1,080.766

Share price = $18.945 per unit

Explanation:

<em>The value of a firm is the present value of the free cash flow discounted at the weighted average cost of capital</em>

Year PV

1 52.1 × 1.14^(-1) = 45.70175439

2 68.6 × 1.14^(-2) = 52.40073869

3 78.6 × 1.14^(-3) = 53.05276117

4 74.4× 1.14^(-4) = 44.05077264

5 81.1 × 1.14^(-5) = 42.12079868

Year and beyond

81.1 × 1.04/(0.14-0.04) = 843.44

Total value = 45.70+ 52.40+53.052 + 44.050 +42.120+ 843.44 = 1080.766826

Enterprise value of Heavy Metal= $1,080.766

Share price = Total value - Debt value / number of shares

= (1,080.766 - 304 )/ 41 million units= $18.945 per unit

Share price = $18.945 per unit

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4 years ago

Cullumber Company provides the following information about its defined benefit pension plan for the year 2017. Service cost $ 90

Llana [10]

Answer:

$102,080

Explanation:

Given that,

Service cost = $90,500

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Expected return on plan assets = $62,800

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Pension expense for the year 2017:

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3 years ago

do you beleive sending targeted advertising information to a computer using cookies is objectionable? why or why not?

Rufina [12.5K]

No, I feel that targeted advertising with cookies is not at all objectionable; rather, it is a very efficient technique for an organization to advertise and promote its products or services.

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1 year ago

. El Capitan Foods has a capital structure of 36% debt and 64% equity, its tax rate is 35%, and its beta (leveraged) is 1.4. Bas

almond37 [142]

Answer:

The firm's unleveraged beta is 1.0251

Explanation:

Hamada's equation is used to separate the financial risk of a levered firm from its business risk.

The Hamada equation:

Bu= Bl/(1 + (1 − T)(D/E))

Bl = 1.4

wd = 0.36

Tax rate = 35%

D/E = wd / (1 – wd) = 0.5625 = 56.25%

= 1.4/ (1+(1-0.35)(0.5625))

=1.4/ 1 + (0.65)(0.5625)

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= 1.0251

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4 years ago

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Vitek1552 [10]

Answer:

a supportive leader

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Therefore, Peter's behavior implies that he is most likely <u>a supportive leader</u>.

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3 years ago