1. What is the value of the company?(Round off answer to two decimal places and include comma) 2. What is the value of the common stock per share?(Round off answer to two decima places and include comma)

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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MacJolly Corporation is expecting a cash flow of P3,000,000 next year and it is expected
to constantly increase by 4% for the next 2 years. After the third year, experts predict
that the cash flow of the company will remain flat at P7,000,000 every year. The
company has a total preferred shares of P10,000,000 and a total debt of P30,000,000.
The required return is currently at 8% while the total common share outstanding is at
1,500,000 shares.
1. What is the value of the company?(Round off answer to two decimal places and
include comma)
2. What is the value of the common stock per share?(Round off answer to two decimal
places and include comma)
Transcribed Image Text:MacJolly Corporation is expecting a cash flow of P3,000,000 next year and it is expected to constantly increase by 4% for the next 2 years. After the third year, experts predict that the cash flow of the company will remain flat at P7,000,000 every year. The company has a total preferred shares of P10,000,000 and a total debt of P30,000,000. The required return is currently at 8% while the total common share outstanding is at 1,500,000 shares. 1. What is the value of the company?(Round off answer to two decimal places and include comma) 2. What is the value of the common stock per share?(Round off answer to two decimal places and include comma)
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