Calculation of Net Present Value of Net Cash Benefit from the Sock and Shoe Merger. The after-tax cash flow is $250,000 for 10 years. The cost of capital is 7%. Payment to Shoe's stockholders $1,100,000. Assumption of Shoe's debt is $300,000. What is the NPV of the merger? Group of answer choices $426,724.33 $355,895.39 $277,525.52 $655,895.47
Calculation of Net Present Value of Net Cash Benefit from the Sock and Shoe Merger. The after-tax cash flow is $250,000 for 10 years. The cost of capital is 7%. Payment to Shoe's stockholders $1,100,000. Assumption of Shoe's debt is $300,000. What is the NPV of the merger? Group of answer choices $426,724.33 $355,895.39 $277,525.52 $655,895.47
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Calculation of Net Present Value of Net Cash Benefit from the Sock and Shoe Merger. The after-tax cash flow is $250,000 for 10 years. The cost of capital is 7%. Payment to Shoe's stockholders $1,100,000. Assumption of Shoe's debt is $300,000. What is the NPV of the merger?
Group of answer choices
$426,724.33
$355,895.39
$277,525.52
$655,895.47
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