Net profit of Lily Fashion House Ltd in the current year is $2,575, 000. The company is planning to launch a project that will requires an investment of $745 000 next year. Todaythe company’s stockhas market value of $22/share.Lily Fashion House has thecurrent capital structure of 60% in equity and 40% in debt..Floral Textile Ltd. is a daughter company of the Lily Fashion HouseGroup and currently under a liquidation plan due to severe business contraction caused by the COVID19 pandemic. The company plans to pay total dividend of $3.5 million now and $ 8.5 million one year from now as a liquidating dividend. The required rate of return for shareholders is 13.5%. Calculate the current value of the firm’s equity in total and per share if the firm has 2.5 million shares outstanding?
Net profit of Lily Fashion House Ltd in the current year is $2,575, 000. The company is planning to launch a project that will requires an investment of $745 000 next year. Todaythe company’s stockhas market value of $22/share.Lily Fashion House has thecurrent capital structure of 60% in equity and 40% in debt..Floral Textile Ltd. is a daughter company of the Lily Fashion HouseGroup and currently under a liquidation plan due to severe business contraction caused by the COVID19 pandemic. The company plans to pay total dividend of $3.5 million now and $ 8.5 million one year from now as a liquidating dividend. The required
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