Use the following data for a home health firm to answer questions 1 and 2. Net i

Question

Use the following data for a home health firm to answer questions 1 and 2.

                        Net income after taxes                    $1,000,000

                        Depreciation                                       300,000

                        Interest                                               100,000

                        Capital Expenditures                           400,000

                        Working Capital Expenditures              500,000

                        Long-Term Debt                               1,000,000

                        Income Taxes                                     400,000             

Please provide calculations

1.   What is the current value of

Explanation / Answer

Net income after taxes             $1,000,000 Depreciation 300,000 Interest                        100,000 Capital Expenditures     400,000 Working Capital Expenditures   500,000 Long-Term Debt          1,000,000 Income Taxes                            $400,000 Free Cash Flow= PAT-Capital Expenditures+Depreciation-Changes in WC Free Cash Flow= 1,000,000 - 400,000 +300,000 -500,000 Free Cash Flow= 400,000 Net income after taxes             $1,000,000 Income Taxes                            $400,000 Income before taxes $1,400,000 Interest                        100,000 EBIT $1,500,000 Depreciation 300,000 EBITDA $1,800,000 Value= (MV of Equity+MV of Debt)/EBITDA 20=MV of Equity+1,000,000)/1,800,000 MV of Equity = 36,000,000-1,000,000 MV of Equity = 35,000,000

Related Questions

Navigate

• Browse (All)
• Browse U
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.