Below is forecasting information for

Below is forecasting information for

Below is forecasting information for Below is forecasting information for ABC Inc.201620172018Projected EBIT$350$375$395Earnings after Tax$210$225$237Free Cash Flow$155$170$200Assume WACC = 10%; Warranted MV firm/FCF in 2018 = 20. What is an appropriate estimate of thefirm’s terminal value of equity as of the end of 2018, using a warranted multiple of free cash flow as yourestimate?$3,550$4,000$4,820$5,150None of the aboveA project has initial cost of $30,000 and will produce cash inflows of $8,000 per year for the next 5 years.In addition, the project will have the after-tax salvage value of $2,000 at the end of its useful life. The netpresent value of the project assuming a discount rate of 10%1,568.14326.29-1,568.14-326.29Below is information for Abotte CorpSystematic risk1.5Non-systematic risk3Market value of Debt$500,000Tax30%Market risk premium5%Cost of debt10%Risk-free rate3%Firm value$1,000,000What is the firm’s WACC?8.75%6.3 %9.2%12.0 %None of the aboveA firm has EBIT of $150 million and a times interest earned ratio of 6.0. How much can EBIT fall (inpercentage terms) before the coverage ratio drops to 1.0?80.7%75.0%83.3%66.7%Below is forecasting information for AZN Inc.201620172018Projected EBIT$350$375$395Earnings after Tax$210$225$237Free Cash Flow$150$190$220Assume WACC = 10%; Expected growth rate in FCFs after 2018 into the indefinite future is 5%; What is anappropriate estimate of the firm’s terminal value as of the end of 2018, using the perpetual-growthequation as your estimate?$3,500$4,000$4,620$5,550None of the aboveBelow is information for Rosie CorpEBIT2,000Working capital investment30Capital expenditure$500Tax30%Depreciation100What is the firm’s FCF?9709851,0501,200None of the aboveTrueBook Inc. has its systematic risk of 1.5. The market risk premium is 6%. The risk-free rate is 3%. Whatis the firm’s cost of equity?10.5%11.01%12.0%14%.1None of the aboveGiven the information below, find the amount of the net income?Debt/Equity0.57Total asset turnover1.12Profit margin0.049Equity$511,64034,00044,08448,40050,312None of the above.A project has an initial cost of $30,000 and will produce cash inflows of $8,000 per year for the next 5years. In addition, the project has a salvage value of $2,000 at the end of its useful life. What is theproject’s accounting rate of return?17.20%8.76%10.42%11.96%

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