Answer:
= $52.78 per share
Explanation:
<em>The value of a business can be determined using the free cash flow model. According to this model, the value of a firm is is the present value of its free cash flow discounted at the weigthed average cost of capital (WACC.)</em>
<em>The value of equity is the value of firm less value of other instruments (e.g debt and preferred stocks)</em>
<em>Value of equity = Value of the entire firm - Value of debt </em>
We can work out the the value per share using the steps below:
<em>Step 1</em>
<em>Calculate the total value of the firm</em>
Value of firm = 27.50/(0.1-0.07)
= $916.66 million
<em>Step 2</em>
<em>Calculate the value of equity</em>
<em>Value of equity = Value of the entire firm - Value of debt</em>
= $916.66 million - $125.0 million
=791.666 million
<em>Step 3</em>
<em>Calculate the value per share</em>
Value per share = Value of equity/ units of common stock
=$791.666 million/15 million units
= $52.78 per share
Answer:
Debit Allowance for Doubtful Accounts $2,300; credit Accounts Receivable $2,300
Explanation:
The journal entry is shown below:
Allowance for Doubtful Accounts A/c Dr $2,300
To Accounts Receivable A/c $2,300
(Being the written-off amount is recorded)
Since we have to record this journal entry so we debited the Allowance for Doubtful Accounts A/c and credited the account receivable account so that the correct posting can be done.
Answer: 1 year
Explanation: According to the Defence Federal Acquisition Regulation under 237.106, personal service contracts that apply to consulting or expert services will be limited to one year. However this will only apply to duties that are temporary (limited to 1 year, or 12 months), or non cumulative days (needs to be 130 days or more that are broken up within a year). During this time the officer contracting the service will enter into a contract, make an order, or exercise options for various services that do not exceed 1 year.
The large number of the population in childbearing age
Answer:
A base salary of $500,000 plus a stock option package for 250,000 shares, with 20% of shares maturing at the end of each of the next five years
Explanation:
This options will force the employee to stay in the firm for at least 5 years
Also it will tie his contribution to the market share
So their interest will be alinged with the company's interest of increasing his value and project better earnings through the five years program.