Using the residual income model: Suppose a firm is projected to have: Common shareholders' equity at beginning of year Comprehensive income available for common shareholders $ The cost of equity capital is 8.9%. What is the required income in year + 1? OA. $339.31 B. $371.56 OC. $420.19 OD. $483.56 Year +1 5,433.25 2,177.88

You have following information about a company: Book value of equity per share = $40 ROE = 20% Required return on equity = 12% Estimated residual income growth rate = 6% Use a single-stage residual income model and calculate the intrinsic value of the company's common stock. a) $40 Ob) $53.33 c) $93.33 d) $120 e) $100

if A firm's current balance sheet is as follows: Assets                      $100                   Debt                                $10                                                           Equity                                $90 a. what is the firm's weighted-average cost of capital at various combinations of debt and equity, given the following information?  Debt/assets      after-tax cost of Debt     cost of equity    cost of capital 0%                                       8%                        12%                      ? 10                                         8                           12                        ? 20                                         8                          12                         ? 30                                         8                          13                         ? 40                                         9                          14                         ?  50                                        10…

ABC Inc. has the following data. If it follows the residual dividend model, what is its forecasted dividend payout ratio? Capital budget % Debt Net income (NI) Select one: a. 49.20% b. 37.20% c. 31.60% d. 39.60% e. 40.00% $7,000 40% $7,000

Suppose the Earnings Multiple of the comparable firms is 10.5 and the next year projected net income of Firm X is $990 million, what is the terminal value for Firm X based on the earnings multiple approach? O a. $9812 O b. $10395 O c. $12945 O d. $12815

What is the price per share based on the equity free cash flow model? Year 1: Revenue: 630 Fixed costs: 120 Variable costs: 200 Additional investments in NWC: 10 Additional investments in operating long-term assets: 70 Depreciation: 60 Interest expenses: 35 Newly issued debt: 25 Principal repayment: 15 Cost of equity, Rs: 0.14 Corporate tax rate: 0.40 Growth rate per year: From year 1 through year 5: 0.12 After year 5: 0.05 Market value: Short-term debt: 100 Long-term debt: 600 Common Stock: Market price per share: 18 Number of shares: 100 Select one: a. $16.39 O b. $14.21 O c. $13.09 O d. $15.33 Time left 0:04:22

A company will produce $3.00 in earnings per share at the end of the year. Reinvested earnings can produce a 14% return on equity. What is the PVGO if the company decides on a 30.0% plowback policy? Assume that investors have a 9.0% required rate of return. a. $10.42 b. $12.56 c. $13.86 d. $15.56

Use the information below to calculate WACC given the Market Capitalization of       the company:               Market Cap = 193.2 Million     EBIT = 17.2 Million             Depreciation = 4.2 Million       Capital Expenditures = - 3.8 Million   Change in W/C = 2.1 Million      growth = 7%          FCF = ?                             WACC = ?

Estimating Cost of Equity Capital Assume that a company’s market beta equals 0.8, the risk-free rate is 5%, and the market return equals 8%. Compute the company’s cost of equity capital. Round answer to one decimal place (ex: 0.0245 = 2.5%) Answer%

Based on the data given below, calculate the return on invested capital (ROIC). Net income = $300 NOPAT = $400 Short-term investments = $200 Stockholders' equity = $1,800 Total operating capital = $2,300 Group of answer choices   17.39% 14.91% 15.70% 16.67%