Consider the following information that you propose to use to obtain an estimate of year 2004 EPS for the MacLog Company. Estimated Year 2019 Year 2020 GDP 11,000 Billion GDP growth 3.5% Sales per share $800 Operating profit margin 12% Depreciation/Fixed Assets 14% Fixed asset turnover 2 Interest rate 3.5% Total asset turnover 0.7 Debt/Total assets 45% Tax rate 36% In addition, a regression analysis indicates the following relationship between growth in sales per share for MacLog, and GDP growth is %Δ Sales per share = 0.015 + 0.75(%Δ GDP) Refer to Exhibit 9.6. Calculate the firm's level of Total Assets per share for the year 2020. a. $1,385.77 b. $1,113.58 c. $1,050.65 d. $1,065.67 e. $1,190.06
Consider the following information that you propose to use to obtain an estimate of year 2004 EPS for the MacLog Company. Estimated Year 2019 Year 2020 GDP 11,000 Billion GDP growth 3.5% Sales per share $800 Operating profit margin 12% Depreciation/Fixed Assets 14% Fixed asset turnover 2 Interest rate 3.5% Total asset turnover 0.7 Debt/Total assets 45% Tax rate 36% In addition, a regression analysis indicates the following relationship between growth in sales per share for MacLog, and GDP growth is %Δ Sales per share = 0.015 + 0.75(%Δ GDP) Refer to Exhibit 9.6. Calculate the firm's level of Total Assets per share for the year 2020. a. $1,385.77 b. $1,113.58 c. $1,050.65 d. $1,065.67 e. $1,190.06
Financial Reporting, Financial Statement Analysis and Valuation
8th Edition
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Chapter14: Valuation: Market-based Approach
Section: Chapter Questions
Problem 20PC
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Question
Consider the following information that you propose to use to obtain an estimate of year 2004 EPS for the MacLog Company.
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Estimated |
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Year 2019 |
Year 2020 |
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|
GDP |
11,000 Billion |
|
|
GDP growth |
3.5% |
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|
Sales per share |
$800 |
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|
Operating profit margin |
12% |
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|
Depreciation/Fixed Assets |
14% |
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|
Fixed asset turnover |
2 |
|
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Interest rate |
3.5% |
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|
Total asset turnover |
0.7 |
|
|
Debt/Total assets |
45% |
|
|
Tax rate |
36% |
In addition, a regression analysis indicates the following relationship between growth in sales per share for MacLog, and GDP growth is
%Δ Sales per share = 0.015 + 0.75(%Δ GDP)
Refer to Exhibit 9.6. Calculate the firm's level of Total Assets per share for the year 2020.
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|
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