Example of asset based valuation, Finance Basics

Assignment Help:

Example of Asset Based Valuation

Extracted information from the books of Kent Limited.

 

Current liabilities

Bank overdraft

   Sh.

300,000

  50,000

350,000

 

Land

Stock in trade

Sh.

250,000

100,000

350,000

Stock has a realizable value of Sh.80, 000 and land Sh.300, 000.  This company is supposed to be containing a share capital of ordinary shares20, 000.

Calculate the value of its shares.

i)       Assets method

          Assets = L and B            300,000

                     Stock                  80,000

                                                380,000

                    Liabilities             [350,000]

                                                   30,000

          Value of shares   =        30,000/20,000

                                      =        Sh.1.50


Related Discussions:- Example of asset based valuation

Present value of an annuity, Determine the Present Value of An Annuity and ...

Determine the Present Value of An Annuity and give explanation of this topic?????

Mgmt640, Monroe, Inc., is evaluating a project. The company uses a 13.8 per...

Monroe, Inc., is evaluating a project. The company uses a 13.8 percent discount rate for this project. Cost and cash flows are shown in the table. What is the NPV of the project?

Option Pricing, Show that for any constant 0=a=1, C(aK1 + (1-a)K2) = aC(K1)...

Show that for any constant 0=a=1, C(aK1 + (1-a)K2) = aC(K1) + (1-a)C(K2) where C(k) is the European option price with strike K. All the options in this question are assumed to be

Determine the net present value and internal rate, Berick Ltd is a relative...

Berick Ltd is a relatively small engineering company that manages to compete effectively with larger companies by adapting to changing market requirements and specialising in innov

Compound interest and compound amount.., a debt off Rs1000 with interest at...

a debt off Rs1000 with interest at 10% compounded quarterly will be repaid by payments Rs. 200 at the end of 3 months and three equal payments at the end of 6 9 and 12 months. find

How is finance related to the accounting and economics, How is finance rela...

How is finance related to the disciplines of accounting and economics? Financial management is necessarily a combination of economics and accounting. First, financial managers

Determine market price of a share, What is the market price of a share of s...

What is the market price of a share of stock for a firm that pays dividends of $1.20 per share, has a P/E of 14, and a dividend payout ratio of 0.4?  market price of a share

Present value of a lump sum - dcf technique, Present Value of a Lump Sum - ...

Present Value of a Lump Sum - DCF Technique Generally an investor would want to know how much he or she would stop currently to get a provided amount in year 1, 2, ... n.  In

Creditors payment period ratio, Creditors Payment Period Ratio Credit...

Creditors Payment Period Ratio Creditors payment period =   365/ Creditors turnover                                           = (365 x Average creditors)/Annual credit pu

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd