< >A ezto.mheducation.comM Question 12 - Midterm 1 - ConnectC Finance question | Chegg.comMidterm 1SavedHelpSave & ExitSubmitHere is a simplified balance sheet for Locust Farming:12Locust FarmingBalance Sheet($ in millions)$ 42,52846,840$ 29,75127,75614,32517,536$ 89,368Current assetsCurrent liabilitiesLong-term debtOther liabilitiesLong-term assets8 01:19:37EquityTotal$ 89,368TotalLocust has 661 million shares outstanding with a market price of $87 a share.a. Calculate the company's market value added. (Enter your answers in millions.)Market valuemillionMarket value addedmillionb. Calculate the market-to-book ratio. (Round your answer to 2 decimal places.)Market-to-book ratioc. How much value as the company created for its shareholders as a percent of shareholders' equity, that is, the net capital contributedE.-- L. - 1- -L-.--L-I- ---n r.-1--McGrawHill< Prev12 of 19Next >Education < >A ezto.mheducation.comM Question 13 - Midterm 1 - ConnectC Get Homework Help With Chegg Study | Chegg.comMidterm 1SavedHelpSave & ExitSubmitHere are simplified financial statements for Watervan Corporation:13INCOME STATEMENT(Figures in $ millions)Net salesCost of goods soldDepreciationEarnings before interest and taxes (EBIT)Interest expenseIncome before tax$895.00755.0045.008 01:12:40$ 95.0026.00$ 69.00Taxes14.49Net income$ 54.51BALANCE SHEET(Figures in $ millions)StartofEnd ofYearYearAssetsCurrent assets$ 383$ 340Long-term assetsTotal assets286236$ 669$ 576Liabilities and shareholders' equityCurrent liabilities$ 208$ 171Long-term debtShareholders' equity122339135270Total liabilities and shareholders' equity$ 669$ 576The company's cost of capital is 8.5%.a. Calculate Watervan's economic value added (EVA). (Do not round intermediate calculations. Enter your answer in millionsrounded to 2 decimal places.)b. What is the company's return on capital? (Use start-of-year rather than average capital.) (Do not round intermediate calculations.Enter your answer as a percent rounded to 2 decimal places.)c. What is its return on equity? (Use start-of-year rather than average equity.) (Enter your answer as a percent rounded to 2 decimalplaces.)d. Is the company creatina value for its shareholders?McGrawHill< Prev13 of 19Next >Education.....:

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Here is a simplified balance sheet for Locust Farming: 12 Locust Farming Balance Sheet ($ in millions) $ 42,528 46,840 Current liabilities Long-term debt Other liabilities Equity $ 29,751 27,756 14,325 17,536 $ 89,368 Current assets Long-term assets 01:19:37 Total $89,368 Total Locust has 661 million shares outstanding with a market price of $87 a share. a. Calculate the company's market value added. (Enter your answers in millions.) Market value Market value added million million b. Calculate the market-to-book ratio. (Round your answer to 2 decimal places.) Market-to-book ratio

Here is a simplified balance sheet for Locust Farming: 12 Locust Farming Balance Sheet ($ in millions) $ 42,528 46,840 Current liabilities Long-term debt Other liabilities Equity $ 29,751 27,756 14,325 17,536 $ 89,368 Current assets Long-term assets 01:19:37 Total $89,368 Total Locust has 661 million shares outstanding with a market price of $87 a share. a. Calculate the company's market value added. (Enter your answers in millions.) Market value Market value added million million b. Calculate the market-to-book ratio. (Round your answer to 2 decimal places.) Market-to-book ratio

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter12: Corporate Valuation And Financial Planning

Section: Chapter Questions

Problem 12SP

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