Archive for the 'Other – Business & Finance' Category
Hey,
I have to calculate the ‘Current Market Value’ of a firm, and i’m only given this data:
Annual net free cash flows are $365000.
Risk-free interest rate is 6.25%pa.
Total book value of assets of $3.1m.
Standard deviation of firms stock return is 27%.
Cost of capital of 16% per year.
Shareholders represent a total of at least 55% of the equity.
Future Value of $1 invested in a similar firm with similar risk: $1.20 in good economy, $0.85 in bad economy.
Other company take over bid offer: $11m
My problem is, i thought Current Market Value = (Share Price * Number of Shares) + Debt. I think Debt is the book value of 3.1m, but i cant seem to find the price of the shares or how many there are to calculate the equity… Am i on the right track, or have i missed the point completly…? any help would be greatly appreciated.
Cheers
Richie
I am a college student with aspirations of becoming an entrepenuer. I would like to open a Event Planning/ PR firm and I actually want to throw my own events at nightclubs for other college students, in the near future and I would like to know aside from loans and things of that nature how can I get sponsors to sponsor my first event?
A firm is planning to increase its inventory turnover by 1.5 turns next year. This year’s inventory is $40M with revenues of $850M. Revenues are expected to grow by 10% next year. The firm’s cost ratio (COGS as a percent of sales) is 40%, and is not expected to change in the near future. Calculate the inventory figure that should be included in next year’s plan. Calculate using the cost of goods sold (COGS) formulation of inventory turnover and using year-end balances only.












