Please give me answer general accounting question Residual Claims: Atlas Corp has debt obligations of $9,200 dueshortly.a. What is the market value of the shareholders' equity if assetshave a market value of $12,500?b. What is the market value of the shareholders' equity if assetsequal $8,800?

Step a:Find the market value of assets: $12,500Subtract the debt obligations:Debt =…

Answered: Residual Claims: Atlas Corp has debt…

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter3: Analysis Of Financial Statements

Section: Chapter Questions

Problem 8P

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Edwards Construction currently has debt outstanding with a market value of $104,000 and a cost of 12 percent. The company has EBIT of $12,480 that is expected to continue in perpetuity. Assume there are no taxes. a-1. What is the value of the company's equity? (Do not round intermediate calculations. Leave no cell blank - be certain to enter "0" wherever required.) a- What is the debt-to-value ratio? (Do not round intermediate calculations and round 2. your answer to the nearest whole number, e.g., 32.) b. What are the equity value and debt-to-value ratio if the company's growth rate is 6 percent? (Do not round intermediate calculations and round your "Debt-to- value" answer to 3 decimal places, e.g., 32.161.) c. What are the equity value and debt-to-value ratio if the company's growth rate is 10 percent? (Do not round intermediate calculations and round your "Debt-to- value" answer to 3 decimal places, e.g., 32.161.) Answer is complete but not entirely correct. a-1. Value of equity…
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Residual Claims: Atlas Corp has debt obligations of $9,200 due shortly. a. What is the market value of the shareholders' equity if assets have a market value of $12,500? b. What is the market value of the shareholders' equity if assets equal $8,800?