You have been asked by an investor to compute for the Economic Value Added of the companies he is considering to invest into as follows:    E V A Net Investment 55,000,000 60,000,000 70,000,000 WACC 8% 9% 10% Net Income after Tax 3,510,000 2,750,000 5,230,0000 Net Operating Income After Tax 4,550,000 5,450,000 6,850,000   Which Company under consideration has the highest EVA Which companies would you recommend for investment, Why? What is the EVA of each companies under consideration?

Assume a firm has EBAT of $590,000, and no amortization. It is in a 40 percent tax bracket. a. Compute its cash flow. $ 354,000 b. Assume it has $590,000 in amortization. Recompute its cash flow. $ 590,000 c. How large a cash flow benefit did the amortization provide? $T] Cash flow Cash flow Benefit in cash flow

What is the company's WACC if it has the following capital structure and 40% tax rate? 7.5% Market Value Required rate of return Bond $60,000,000 4% Preferred Stock $60,000,000 6% Common Stock $120,000,000 10% O 6.67% O 9.4% 7.1%

What is the company's cost of debt? a. 9.21%b. 10.31%c. 11.5%d. 7.73% What is the company's cost of equity using the Capital Asset Pricing Model? a. 9.21%b. 10.31%c. 11.5%d. 7.73%

Need all three parts

If $5,000 is invested into a company with a pre-money valuation of $50,000, then the post-money valuation is _____ and the investor owns_____ of the company (fill in the blanks): $50,000; 10% $50,000; 9% $55,000; 10% $55,000; 9% 33

Peter Johnson, the CFO of Homer Industries, Inc is trying to determine the Weighted Cost of Capital (WACC) based on two different capital structures under consideration to fund a new project. Assume the company’s tax rate is 30%. Component Scenario 1 Scenario 2 Cost of Capital Tax Rate Debt $5,000,000.00 $2,000,000.00 8% 30% Preferred Stock 1,200,000.00 2,200,000.00 10%   Common Stock 1,800,000.00 3,800,000.00 13%   Total $8,000,000.00 $8,000,000.00         1-a. Complete the table below to determine the WACC for each of the two capital structure scenarios. (Enter your answer as a whole percentage rounded to 2 decimal places (e.g. .3555 should be entered as 35.55).)   Scenario 1 weight % Scenario 2 weight % Scenario1 weighted cost Scenario 2 weighted cost  cost of capital tax rate Dept ? ? ? ? 8% 30% Preferred stock ? ? ? ? 10%   Common stock ? ? ? ? 13%   Total ? ? ? ?       1-b. Which capital structure shall Mr. Johnson choose to fund the new project?…

Calculation of individual costs and WACC: Dillon Labs has asked its financial manager to measure the cost of each specific type of capital as well as the weighted average cost of capital. The weighted average cost is to be measured by using the following​ weights: 35​% long-term debt, 10​% preferred​ stock, and 55​% common stock equity​ (retained earnings, new common​ stock, or​ both). The​ firm's tax rate is 28​%. debt The firm can sell for ​$1010 a 14​-year, ​$1,000​-par-value bond paying annual interest at a 7.00​% coupon rate. A flotation cost of 2.5​% of the par value is required. Preferred stock 7.00​% ​(annual dividend) preferred stock having a par value of ​$100 can be sold for ​$88. An additional fee of​$4 per share must be paid to the underwriters. Common stock The​ firm's common stock is currently selling for ​$70 per share. The stock has paid a dividend that has gradually increased for many​ years, rising from ​$2.25 ten years ago to the ​$3.67 dividend​payment, D0​, that…