ca plc’s 2014 annual report and financial statements, explain how an adjusted book value approach to valuing assets and liabilities moves book value nearer to economic value.You are required to provide a written response which highlights four specific items in AstraZeneca plc’s balance sheet that might require adjusting to arrive at an economic value.For each item, explain the type of adjustment and the type of information that might be required before an adjustment could be made to arrive at an economic value for AstraZeneca plc at its 2014 financial year-end.· Calculate the following market multiple ratios for AstraZeneca plc at its 2014 financial year-end:· i.EV/EBITDA· ii.Price-to-earnings ratio (PE ratio)· iii.Price-to-cash-flow ratio· iv.Contrast and explain the results of the different market multiple ratios that you calculated. Evaluate the usefulness of market multiple ratios in company valuation.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Using AstraZeneca plcâ??s 2014 annual report and financial statements, explain how an adjusted book
 
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Using AstraZeneca plc’s 2014 annual report and financial statements, explain how an adjusted book value approach to valuing assets and liabilities moves book value nearer to economic value.You are required to provide a written response which highlights four specific items in AstraZeneca plc’s balance sheet that might require adjusting to arrive at an economic value.For each item, explain the type of adjustment and the type of information that might be required before an adjustment could be made to arrive at an economic value for AstraZeneca plc at its 2014 financial year-end.· Calculate the following market multiple ratios for AstraZeneca plc at its 2014 financial year-end:· i.EV/EBITDA· ii.Price-to-earnings ratio (PE ratio)· iii.Price-to-cash-flow ratio· iv.Contrast and explain the results of the different market multiple ratios that you calculated. Evaluate the usefulness of market multiple ratios in company valuation.

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