FCF 9th edition Chapter 16

FCF 9th edition Chapter 16 - Chapter 16 Problems 1-22 Input...

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Chapter 16 Problems 1-22 Input boxes in tan Output boxes in yellow Given data in blue Calculations in red Answers in green NOTE: Some functions used in these spreadsheets may require that the "Analysis ToolPak" or "Solver Add-in" be installed in Excel. To install these, click on "Tools|Add-Ins" and select "Analysis ToolPak" and "Solver Add-In."
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Chapter 16 Question 1 Input Area: Market value $250,000 EBIT $28,000 Expansion-EBIT 30% Recession-EBIT 50% Debt issue $90,000 Interest rate 7% Shares outstanding 5,000 Output Area: No debt EBIT $14,000 $28,000 $36,400 Interest $- $- $- NI $14,000 $28,000 $36,400 EPS $2.80 $5.60 $7.28 Change EPS% -50.00% 0.00% 30.00% With debt Share price = $50.00 Shares repurchased = 1,800.00 EBIT $14,000 $28,000 $36,400 Interest $6,300 ### $6,300 ### $6,300 NI $7,700 $21,700 $30,100 EPS $2.41 $6.78 $9.41 Change EPS% -64.52% 0.00% 38.71%
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Chapter 16 Question 2 Input Area: Market value $250,000 EBIT $28,000 Expansion-EBIT 30% Recession-EBIT 50% Debt issue $90,000 Interest rate 7% Shares outstanding 5,000 Tax rate 35% Output Area: No debt with taxes EBIT $14,000 $28,000 $36,400 Interest - - - Taxes 4,900 9,800 12,740 NI $9,100 $18,200 $23,660 EPS $1.82 $3.64 $4.73 Change EPS% -50.00% 0.00% 30.00% With debt and taxes Share price = $50.00 Shares repurchased = 1,800.00 EBIT $14,000 $28,000 $36,400 Interest 6,300 ### 6,300 ### 6,300 Taxes 2,695 7,595 10,535 NI $5,005 $14,105 $19,565 EPS $1.56 $4.41 $6.11 Change EPS% -64.52% 0.00% 38.71%
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Chapter 16 Question 3 Input Area: No debt TE = MV = $250,000 With debt TE = $160,000 Output Area: a. ROE 5.60% 11.20% 14.56% Change ROE% -50.00% 0.00% 30.00% b. ROE 4.81% 13.56% 18.81% Change ROE % -64.52% 0.00% 38.71% c. No debt No debt, ROE 3.64% 7.28% 9.46% Change ROE % -50.00% 0.00% 30.00% With debt With debt, ROE 3.13% 8.82% 12.23% Change ROE % -64.52% 0.00% 38.71%
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Chapter 16 Question 4 Input Area: Plan I: Shares outstanding 160,000 Plan II: Shares outstanding 80,000 Debt outstanding $2,800,000 Interest rate 8% a. EBIT $350,000 b. EBIT $500,000 Output Area: a. NI EPS Plan I $350,000 $2.19 Plan II $126,000 $1.58 b. Plan I $500,000 $3.13 Plan II $276,000 $3.45 c. Breakeven EBIT = $448,000.00
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Chapter 16 Question 5 Input Area: Plan I: Shares outstanding 160,000 Plan II: Shares outstanding 80,000 Debt outstanding $2,800,000 Interest rate 8% a. EBIT $350,000 b. EBIT $500,000 Output Area: Price $35.00 V (I) $5,600,000.00 V (II) $5,600,000.00
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Chapter 16 Question 6 Input Area: Plan I: Shares outstanding 7,000 Debt $160,000 Plan II: Shares outstanding 5,000 Debt outstanding $240,000 Interest rate 10% a. EBIT $39,000 All-equity shares 11,000 d. Tax rate 40% Output Area: a. I II All-Equity EBIT $39,000 $39,000 $39,000
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This note was uploaded on 02/09/2012 for the course BMGT 340 taught by Professor None during the Spring '11 term at Shoreline.

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FCF 9th edition Chapter 16 - Chapter 16 Problems 1-22 Input...

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