Fact pattern: $ in millions, EBITDA at Close $27, Exit Multiple 9.5x, Investment Hold Period 5 years, Liquidation Preference 1.0x, preferred annual PIK Dividend 10%, Target Balance Sheet Items Cash 10, Revolver 6.5, Senior Debt 85, Preferred Equity (excl, Dividend). Based on this fact pattern what is the Equity Available to Common? $0M, $50M, $80.5M, $94.5M, or $175 M?

Cornerstones of Financial Accounting
4th Edition
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Jay Rich, Jeff Jones
Chapter10: Stockholder's Equity
Section: Chapter Questions
Problem 79E: Ratio Analysis MJO Inc. has the following stockholders equity section of the balance sheet: On the...
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Fact pattern: $ in millions, EBITDA at Close $27, Exit Multiple 9.5x, Investment Hold Period 5
years, Liquidation Preference 1.0x, preferred annual PIK Dividend 10%, Target Balance Sheet
Items Cash 10, Revolver 6.5, Senior Debt 85, Preferred Equity (excl, Dividend). Based on this
fact pattern what is the Equity Available to Common? $0M, $50M, $80.5M, $94.5M, or $175
M?
Transcribed Image Text:Fact pattern: $ in millions, EBITDA at Close $27, Exit Multiple 9.5x, Investment Hold Period 5 years, Liquidation Preference 1.0x, preferred annual PIK Dividend 10%, Target Balance Sheet Items Cash 10, Revolver 6.5, Senior Debt 85, Preferred Equity (excl, Dividend). Based on this fact pattern what is the Equity Available to Common? $0M, $50M, $80.5M, $94.5M, or $175 M?
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