Entrepreneurial Finance, Fourth Edition: Finance and Business Strategies for the Serious Entrepreneur, 4th Edition by Steven Rogers

Author:Steven Rogers [Steven Rogers]
Language: eng
Format: epub
Publisher: McGraw-Hill
Published: 2020-05-11T16:00:00+00:00

FIGURE 6-8 Forecasted Annual Free Cash Flow Calculation, in Thousands of Dollars

The PV of the FCF planning period is determined as shown in Figure 6-9. With an estimated Year 6 FCF valuation of $960,300, the PV residual can be calculated using the equation in Figure 6-10. Now we can determine the value of Bruce.com. As you can see in Figure 6-11, Bruce.com’s value is $19,798,746.

FIGURE 6-9 Present Value of Free Cash Flow for the Planning Period Calculation

FIGURE 6-10 Present Value of the Residual Calculation

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