A reputable company plans to place an investment with a private equity firm with an amount of Php 10M for 2023. Considering all the risks involved, the prevailing discount rate is 12% and with a revenue stream/dividends below: 2023 2024 2025 2026 2027 2028 2029 995,000.00 1,380,000.00 1,575,000.00 1,930,000.00 2,954,000.00 3,408,644.00 6,354,941.00 Find the NPV
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A reputable company plans to place an investment with a private equity firm with an amount of Php 10M for 2023. Considering all the risks involved, the prevailing discount rate is 12% and with a revenue stream/dividends below:
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2023 2024 2025 2026 2027 2028 2029 |
995,000.00 1,380,000.00 1,575,000.00 1,930,000.00 2,954,000.00 3,408,644.00 6,354,941.00 |
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- Begin with the partial model in the file Ch02 P21 Build a Model.xlsx on the textbooks Web site. a. Using the financial statements shown here for Lan Chen Technologies, calculate net operating working capital, total net operating capital, net operating profit after taxes, free cash flow, and return on invested capital for 2020. The federal-plus-state tax rate is 25%. b. Assume there were 15 million shares outstanding at the end of 2019, the year-end closing stock price was 65 per share, and the after-tax cost of capital was 10%. Calculate EVA and MVA for 2020. Lan Chen Technologies: Income Statements for Year Ending December 31 (Millions of Dollars) Lan Chen Technologies: December 31 Balance Sheets (Thousands of Dollars)A reputable company plans to place an investment with a private equity firm with an amount of Php 10M for 2023. Considering all the risks involved, the prevailing discount rate is 12% and with a revenue stream/dividends below: 2019: 995,000.00 2020: 1.380,000.00 2021: 1.575,000.00 2022: 1,930,000.00 2023: 2,954,000.00 2024: 3.408,644.00 2025: 6,354.941.00 What is the NPV?A reputable company plans to place an investment with a private equity firm with an amount of Php 10M for 2023. Considering all the risks involved, the prevailing discount rate is 12% and with a revenue stream/dividends below: 2023 995,000.00 2024 1,380,000.00 2025 1,575,000.00 2026 1,930,000.00 2027 2,954,000.00 2028 3,408,644.00 2029 6,354,941.00 Find the NPV. Group of answer choices No choice given Php10,700,800 Php 12,570,638 Php 10,611,838 Php 9,800,338
- Assume your organization wishes to make a Php 200,000 investment with a private equity firm in 2021. Taking into account all of the risks, the current discount rate is 12%, and the revenue stream/dividends are as follows: 2022 50002023 60002024 70002025 80002026 90002027 100002028 11000 Determine the following: DO IT IN EXCELa. NPV for the period 2022 through 2028;b. Total NPV using manual computation;c. Total NPV using the Excel function; andd. IRR rate.Assume your organization wishes to make a Php 200,000 investment with a private equity firm in 2021. Taking into account all of the risks, the current discount rate is 12%, and the revenue stream/dividends are as follows: 2022 50002023 60002024 70002025 80002026 90002027 100002028 11000 Determine the following:a. NPV for the period 2022 through 2028;b. Total NPV using manual computation;c. Total NPV using the Excel function; andd. IRR rate.Zola Sdn Bhd wants to develop new product through research and development whichrequires additional financing of RM2 million. Zola Sdn Bhd is considering selling one security to raise the needed funds from the following options: i. To sell bonds at RM950,14 percent coupon rate with maturity of 15 years. The underwriting fee is 8 percent of market price. The tax rate for the company is 35 percent. ii. To sell preferred shares at RM85 with 9 percent dividend and RM5 for issuing cost. iii. To issue new common shares at RM23 per share and RM1.20 for floatation cost. The company has just paid RM0.80 in dividend and the earnings is expected to grow at 9 percent annually Calculate the after-tax cost of: i) Bond ii) Preferred shares iii) Common shares iv) Which source should the firm choose? Why? Please use YTM method to calculate the bond.
- Zola Sdn Bhd wants to develop new product through research and development whichrequires additional financing of RM2 million. Zola Sdn Bhd is considering selling one security to raise the needed funds from the following options: i. To sell bonds at RM950,14 percent coupon rate with maturity of 15 years. The underwriting fee is 8 percent of market price. The tax rate for the company is 35 percent. ii. To sell preferred shares at RM85 with 9 percent dividend and RM5 for issuing cost. iii. To issue new common shares at RM23 per share and RM1.20 for floatation cost. The company has just paid RM0.80 in dividend and the earnings is expected to grow at 9 percent annually Calculate the after-tax cost of: i) Bond ii) Preferred shares iii) Common shares iv) Which source should the firm choose? Why?Ring & Bell Bhd. has prepared the next year's pro forma balance sheet which shows the external financing needed (EFN) of RM100,000. To bring the pro forma balance sheet into balance, Ring & Bell should __________. Select one: a. invest in marketable securities totalling RM100,000 b. repurchase common stock totalling RM100,000 c. repay notes payable of RM100,000 d. borrow long-term capital of RM100,000Newman Manufacturing is considering a cash purchase of the stock of Grips Tool. During the year just completed, Grips earned$3.41 per share and paid cash dividends of$1.71per share(D0equals$ 1.71). Grips' earnings and dividends are expected to grow at20%per year for the next 3 years, after which they are expected to grow 5%per year to infinity. What is the maximum price per share that Newman should pay for Grips if it has a required return of 14% on investments with risk characteristics similar to those of Grips?
- A potential investor is willing to provide S500, 000 in first - round financing with the expectation of a 50% annual compound rate of return over the next five years. Founders currently hold 1,000, 000 million shares of stock. The venture is expected to produce $500,000 in net income in year 5. A similar firm with annual net income of $1,000,000 sold shares to the public for $10,000,000. What is the post- money valuation? a. $499, 954 b. $408, 377 c. $658,436 d. $249,977 (Please provide me with the equation for the BA2 Plus calculator method.)Newman Manufacturing is considering a cash purchase of the stock of Grips Tool. During the year just completed, Grips earned $3.95 per share and paid cash dividends of $2.25 per share (D0equals=$ 2.25). Grips' earnings and dividends are expected to grow at 25% per year for the next 3 years, after which they are expected to grow 6% per year to infinity. What is the maximum price per share that Newman should pay for Grips if it has a required return of 11% on investments with risk characteristics similar to those of Grips?A company expects to earn Rs.4.4 million in 2022, and 50% of this amount orRs.2.2 million has been allocated for distribution to common shareholders. Thereare 1.1 million shares outstanding and the market price is Rs.20 a share. Thecompany believes it can either use Rs.2.2 million to repurchase 100,000 sharesthrough a tender offer at Rs.22 a share or else pay a cash dividend of Rs.2 a share.How does this affects EPS, P/E and expected market price?
