Reynolds Construction's value of operations is $733 million based on the corporate valuation model. Its balance sheet shows $70 million of short-term investments that are unrelated to operations, $110 million of accounts payable, $145 million of notes payable, $176 million of long-term debt, $50 million of common stock (par plus paid-in-capital), and $170 million of retained earnings. What is the best estimate for the firm's value of equity, in millions? (Enter your answer as a whole number in millions. For example, if you get 33 million as the answer, enter: 33.
Reynolds Construction's value of operations is $733 million based on the corporate valuation model. Its balance sheet shows $70 million of short-term investments that are unrelated to operations, $110 million of accounts payable, $145 million of notes payable, $176 million of long-term debt, $50 million of common stock (par plus paid-in-capital), and $170 million of
(Enter your answer as a whole number in millions. For example, if you get 33 million as the answer, enter: 33.)
![](/static/compass_v2/shared-icons/check-mark.png)
Formula:
Value of Equity = Value of operations - Log term debt - notes payable + short term investments.
Deduction of long term debt and notes payable from value of operations and short term investments derives the Value of equity.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
![EBK CONTEMPORARY FINANCIAL MANAGEMENT](https://www.bartleby.com/isbn_cover_images/9781337514835/9781337514835_smallCoverImage.jpg)
![EBK CONTEMPORARY FINANCIAL MANAGEMENT](https://www.bartleby.com/isbn_cover_images/9781337514835/9781337514835_smallCoverImage.jpg)