Question
In: Finance
10-EZ Way has a market value equal to its book value. Currently, the firm has excess...
10-EZ Way has a market value equal to its book value. Currently, the firm has excess cash of $1,332, other assets of $11,674 and equity of $7,200. The firm has 1,200 shares outstanding and net income of $838.EZ Way has decided to spend one-third of its excess cash on a share repurchase program. How many shares of stock will be outstanding after the stock repurchase is completed?
Solutions
jeff jeffy answered 2 years agoRelated Solutions
Consider a firm that currently has a market value of $2,000,000. The firm is considering a...
Consider a firm that currently has a market value of $2,000,000.
The firm is considering a project with the following yearly cash
flows and a required return (hurdle rate) of 12%. T=0 -1,500,000
T=1 400,000 T=2 -200,000 T=3 900,000 T=4 700,000 T=5 500,000 a)
What is the NPV of the project? b) Calculate the Modified IRR
(MIRR) using a 12% discount rate. c) If the firm decided to go
forward with (i.e., accept) this project, what would the firm's new...
The A. J. Croft Company (AJC) currently has $200,000 market value (and book value) of perpetual...
The A. J. Croft Company (AJC) currently has $200,000 market
value (and book value) of perpetual debt outstanding carrying a
coupon rate of 6 percent. Its earnings before interest and taxes
(EBIT) are $100,000, and it is a zero-growth company. AJC's current
unlevered beta is 0.5, and its tax rate is 40 percent. The firm has
10,000 shares of common stock outstanding selling at a price per
share of $60.00.
The firm is considering moving to a capital structure that...
The A. J. Croft Company (AJC) currently has $200,000 market value (and book value) of perpetual...
The A. J. Croft Company (AJC) currently has $200,000 market
value (and book value) of perpetual debt outstanding carrying a
coupon rate of 6 percent. Its earnings before interest and taxes
(EBIT) are $100,000, and it is a zero-growth company. AJC's current
unlevered beta is 0.5, and its tax rate is 40 percent. The firm has
10,000 shares of common stock outstanding selling at a price per
share of $60.00.
The firm is considering moving to a capital structure that...
The A. J. Croft Company (AJC) currently has $200,000 market value (and book value) of perpetual...
The A. J. Croft Company (AJC) currently has $200,000 market
value (and book value) of perpetual debt outstanding carrying a
coupon rate of 6 percent. Its earnings before interest and taxes
(EBIT) are $100,000, and it is a zero-growth company. AJC's current
unlevered beta is 0.5, and its tax rate is 40 percent. The firm has
10,000 shares of common stock outstanding selling at a price per
share of $60.00. The firm is considering moving to a capital
structure that...
Currently the firm has total market value of debt $20 million and total market value of...
Currently the firm has total market value of debt $20 million
and total market value of equity $60 million. This capital
structure is considered optimal by the management. The optimal
capital budget for new investment for the coming period is
determined to be $15 million. The total net income is estimated to
be $20 million. The firm has 5 million common shares outstanding.
The most recent dividend per share is $1 and the management intends
to maintain it for the...
Problem 10 A firm has market value of equity of $10M and market value of debt...
Problem 10
A firm has market value of equity of $10M and market value of
debt of $10M. Yield to maturity of its debt is 10%, while the
expected return of its stock is 20%. Assume that the tax rate is
0%. The WACC is given by:
A) 8%
B) 12%
C) 15%
D) 18%
E) 21%
The XYZ company currently has $200000 market value (and book value) of perpetual debt outstanding carring...
The XYZ company currently has $200000 market value (and book
value) of perpetual debt outstanding carring a coupon rate of 6%.
Its EBIT are $100000, and it is zero-growth company with 100%
payout ratio. XYZ's current cost of equity is 8.8%, and its tax
rate is 40%. The firm has 10000 shares of common stock outsatnding
selling at a price per share of $60.
a) XYZ is considering issuing $200000 of addition debt and using
the proceeds to repurchase stock....
How to obtain acquisition date book value and fair value in excess of book value
How to obtain acquisition date book value and fair value in
excess of book value
Currently working on a chart for maturity, YTM, Quoted price, book market value, and market value...
Currently working on a chart for maturity, YTM, Quoted price,
book market value, and market value weight where would i find that
information or how would i calculate it? Currently doing it for
Zoeitis
Clark Explorers, Inc., an engineering firm, has the following capital structure:Using market value and book value...
Clark Explorers, Inc., an engineering firm, has the following
capital structure:Using market value and book value (separately,
of course), find the adjusted WACC for Clark Explorers at the
following tax rates
Equity
Preferred Stock
Debt
Market Price
$30.00
$110.00
$955.00
Outstanding units
120000
10000
6000
Book value
$3,000,000
$1,000,000
$6,000,000
Cost of capital
15.00%
12.00%
9.0%
a What is the market value adjusted WACC for Clark Explorers at
a tax rate of 35%?
b What is the market value...
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