Answer:
The value of the firm is $1,773,333
Explanation:
<u>Calculation of Value of each share</u>
Amount borrowed (A)                    $245,000
No. of shares repurchased (B)      <u>   21,000   </u>
Value for each share (C)               <u>  $11.67   </u>
<u></u>
No. of shares outstanding after repurchase(A)    131,000
(152,000 - 21,000)
Value for each share(B)                                        <u>   $11.67   </u>
Equity value after repurchase(A*B)                     $1,528,333
Add: Amount borrowed                                      <u>  $245,000</u>
Firm value after this transaction                     <u>  $1,773,333</u>