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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Transcribed Image Text:VALUATION CÔNCEPTS AND METHODOLOGIES
b 24. Unicap Company is opening its doors to investors and shared the
following prospective financial information:
A Unicap Company is opening its doors to investors and shared the
following prospective financial information:
2021
2022
10,000,000
2023
2024
14,000,000 15,000,000
Revenues
12,000,000
Cost of Goods Sold
5,000,000
6,000,000
7,000,000
7,500,000
Gross Profit
Selling and Distribution
5,000,000
6,000,000
7,000,000
1,000,000
1,200,000
7,500,000
1,400,000
1,500,000
Administrative
400,000
400,000
400,000
400,000
Depreciation Expense
2,000,000
2,000,000
2,000,000
2,000,000
Operating Income
Income Tax Expense
1,600,000
2,400,000
3,200,000
3,600,000
480,000
720,000
960,000
1,080,000
Net Profit
1,120,000
1,680,000
2,240,000
2,520,000
Required Annual
Capital Investment
1,000,000
1,000,000 - 1,000,000
1,000,000
XYZ, an equity capital venture company, is considering infusing
money to Unicap Company. Based on its assessment, cost of capital
associated with this type of investment is at 10%. Unicap Company
has going concern assumption with net cash flows expected to grow
by 5%. In addition to potential capital investment, Unicap Company
has outstanding debt of P10,000,000. What is the net cash flow to
the firm of Unicap Company?
a. Php70,958,800
b. Php59,468,971
C. Php54,879,120
a. Php50,488,355
4 25. Refer to Unicap Company. If XYZ Company is buying 20% of Unicap
Company, what is the reasonable price that they should pay?
a. Php49,468,971
b. Php17,096,000
C. Php11,893,794
d. Php9,893,794
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