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Determine a value for Shang-wa cash flows

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Objective: Determine a value for Shang-wa cash flows

Create a pro forma income statement for Shang-wa ( 2005,2006, 2007, 2009 FYE) using the assumptions below create an annual cash flow, and determine the present value of those future cash flows by using a 10% discount rate.
Projections: 2005, 2006, 2007, 2008, 2009
Sales to increase by 17%
Cost of goods sold : 62% of sales
Operating expenses will be held to 5% increase.
No increase interest expenses (management decision on future course of financing arrangements)
Other income (expenses) will not be included, due to the lack of information(meaning what it is,and how long will the company continue to receive it).
We will value Shang-wa future cash-flow using a 10% discount rate for the five years projections.
Tax rate: income taxes / income before taxes 1,973 /12,895 = 15.30% tax rate
Your base year will start with the 2004 FYE of Shang-wa

See the attachment for the present value of Shang-wa cash flows.

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Objective: Determine a value for Shang-wa cash flows

Create a pro forma income statement for Shang-wa ( 2005,2006, 2007, 2009 FYE) using the assumptions below create an annual cash flow, and determine the present value of those future cash flows by using a ...

Purchase this Solution
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