Based on the Corporate Valuation Model,Morgan Inc

question 31

Multiple Choice

Based on the corporate valuation model,Morgan Inc.'s total corporate value is $300 million.The balance sheet shows $90 million of notes payable,$30 million of long-term debt,$40 million of preferred stock,and $100 million of common equity.The company has 10 million shares of stock outstanding.What is the best estimate of the stock's price per share?

• A)$12.00
• B)$12.64
• C)$13.30
• D)$14.00
• E)$14.70

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Definitions:

Par Common Stock

Common stock with a nominal or face value assigned to it, often used in accounting to determine legal capital.

Carrying Value

The book value of assets and liabilities as reported in the financial statements.

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