You are assigned to determine a fair value for General Intelligence (GI) Corporation. Youdetermined that market multiples approach would be the best method to determine a fairvalue for this company. The total asset value of the company is 1100 million dollars and theliability is 200 million dollars. The company has 25 million shares outstanding. Gl alsogenerated 990-million-dollar-revenue in the current year. In a typical year, company's returnon equity is 14 percent. You gathered the following three multiples from a close competitor ofGI The P/E (Price-Earnings) ratio is 23, Price to sales (P/S) is 3.8, and price to book (P/B) ratio is5.5. Based on information given about Gl and its competitor, determine the value of Gl usingmarket multiples approach. Based on your analysis, what is the fair value of Gl using P/Smultiple?

To determine the fair value of General Intelligence (GI) Corporation using the market multiples…

Answered: You are assigned to determine a fair…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter12: Balanced Scorecard And Other Performance Measures

Section: Chapter Questions

Problem 3PA: Macon Mills is a division of Bolin Products. Inc. During the most recent year, Macon had a net...

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You are valuing Estelle Company, a private firm that manufactures shop tools, and you have identified several comparable firms that are publicly owned from which to calculate an estimated price-to-earnings multiple to use in your valuation. One of the comparable firms, Comp A, has a market value per share of $53.40, earnings per share for last year of $4.20 per share, a dividend for last year that was $1.10 per share, forecast earnings per share for the next year of $7.05, and a dividend that is expected to be unchanged. The forward price-to-earnings multiple for Comp A is: a. 17.2 b. 12.7 c. 9.0 d. 7.6 e. None of the above.
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Use this information for Mason Corporation to answer the question that follow. Mason Corporation had $1,030,000 in invested assets, sales of $1,275,000, income from operations amounting to $227,000, and a desired minimum return of 12%. Round the percentage to one decimal place. The profit margin for Mason Corporation is Oa. 22.0% Оb. 17.8% Oc. 12.0% Od. 80.8%
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What is the correct answer of this financial accounting question following requirements?

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