Answer Happy

For the following problems, use Exhibit B. Exhibit B has the
balance sheet and Income Statement projections for a specific
company. The company is evaluating if it is worth it to have the
capital investment as shown in the Capital Investment Table. The
EBITDA multiplier of similar companies 7. The debt used has a
coupon of 11.5%. The WACC is 17%.
2023 Integrated Financial Statement Template Exhibit B: Free Cash Flow and Valuation 2021 2022 Income Statement 1 Sales Revenue $ 52,360.00 $ 77,513.27 $ 2 less: Cost of Goods Sold $ 41,364.40 $ 61 235.48 $ 3 EBITDA $ 10,995.60 $ 16,277.79 $ 4 less: Depreciation Expense $ 5.759.60 $ 8.526.46 $ 5 EBIT $ 5,236.00 $ 7,751.33 $ 6 less: Interest and Other Expenses $ 650.00 $ 650.00 $ 7 PRE-TAX INCOME $ 4,586.00 $ 7,101.33 $ 8 less: Income Tax $ 1.605.10 $ 2.485.46 $ 9 NET INCOME $ 2,980.90 $ 4,615.86 $ 105,077.99 83,011.61 22,066.38 11.558.58 10,507.80 6,150.00 4,357.80 1.525.23 2,832.57 $ $ $ $ $ $ 8.901.20$ 9.424.80 $ 9.948.40 $ 28,274.40 $ 29,845.20 $ 58,119.60 $ 13.177.26 $ 13,952.39 $ 14.727.52 $ 41,857.16 $ 44,182.56 $ 86,039.73 $ 17.863.26 18.914.04 19,964 82 56,742.11 59.894.45 116,636.56 Balance Sheet 1 ASSETS 2 Cash and Equivalents 3 Accounts Receivable 4 Inventory 5 CURRENT ASSETS 6 Property, Plant and Equipment 7 TOTAL ASSETS 8 LIABILITIES AND EQUITY 9 Accounts Payable 10 CURRENT LIABILITIES 11 Long-Term Debt 12 TOTAL LIABILITIES 13 STOCKSHOLDER'S EQUITY 14 Retained Earnings 15 TOTAL EQUITY 16 TOTAL LIABILITIES AND EQUITY $ $ $ $ $ $ $ $ 12.042.80 $ 12.042.80 $ 6.500.00 $ 18.542.80 $ 39,576.80 $ $ $ 39,576.80 $ 58,119.60 $ 17,828.05 $ 17,828.05 $ 61,500.00 $ 79,328.05 $ 74,134.00 $ 3,692.69 $ 77,826.69 $ 157,154.74 $ 24,167.94 24.167.94 61,500.00 85,667.94 74,134.00 2.266 08 76,400.06 162,067.99 Net Working Capital Requirements 1 Current Assets 2 Current Liabilities 3 Net Working Capital 4 increase in Net Working Capital Capital Investment 1 Capital Investment 1 IS 2,500.00 57.500.00 $ 8,500.00 Integrated Financial Statement Template Exhibit B: Free Cash Flow and Valuation 2022 2021 2023 Free Cash Flow DOS 1 Net Income 2 Plus After-Tax Interes Expense 3 Unlevered Net Income 4 Plus: Depreciation 5 Less: Increases in NWC 6 Less: Capital Expenditures 7 Free Cash Flow of Firm Valuation of the Growth 1 Free Cash Flow of the Firm 2 PV of the Cash Flow 3 Continuation Value 4 PV of Continuation Value 5 net interest Expense 6 Interest Tax Shield 7 PV Interest Tax Shield 8 Firm Value