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    Cali Corporation projections: Calculate current price of the stock.

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    You have been given the following projections for Cali Corporation for the coming year.

    Sales = 10,000 units
    Sales price per unit = $10
    Variable cost per unit = $5
    Fixed costs = $10,000
    Bonds outstanding = $15,000
    rd on outstanding bonds = 8%
    Tax rate = 40%
    Shares of common stock outstanding = 10,000 shares
    Beta = 1.4
    rRF = 5%
    rM = 9%
    Dividend payout ratio = 60%
    Growth rate = 8%

    Calculate the current price per share for Cali Corporation.

    © BrainMass Inc. brainmass.com June 3, 2020, 6:25 pm ad1c9bdddf
    https://brainmass.com/business/accounting/corporation-projections-calculate-current-price-stocks-59830

    Solution Preview

    Sales =10,000*10 = $100,000
    Variable cost = $5*10,000= $50,000
    Fixed costs= ...

    Solution Summary

    The solution shows all the formulas and calculations to arrive at a price for the stock.

    $2.19

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