Chapter 13
Input area:
Shares outstanding 9,000,000
Share price 42.50$
Purchase price of land 50,000,000$
Output area:
2) Assets 382,500,000$ Equity 382,500,000$
Total assets 382,500,000$ Debt & Equity 382,500,000$
3) a) Perpetual aftertax earnings 7,200,000$
NPV of purchase
7,600,000$
Balance Sheet
c)
Balance Sheet
Cash 50,000,000$
Old assets 382,500,000
NPV of project 7,600,000 Equity 440,100,000$
Total assets 440,100,000$ Debt & Equity 440,100,000$
Stephenson Real Estate Recapitalization
Balance Sheet
Total assets 440,100,000$ Debt & Equity 440,100,000$
4) a) Value of levered company 460,100,000$