The percent ownership of our venture

Assignment Help Finance Basics
Reference no: EM131135938

A potential investor is seeking to invest $500,000 in a venture, which currently has 1,000,000 shares held by its founders, and is targeting a 50% return five years from now. The venture is expected to produce half a million dollars in income per year at year 5. It is known that a similar venture recently produced $1,000,000 in income and sold shares to the public for $10,000,000.

a. What is the percent ownership of our venture that must be sold in order to provide the venture investorAc€?cs target return?
b. What is the number of shares that must be issued to the new investor in order for the investor to earn his target return?
c. What is the issue price per share?
d. What is the pre-money valuation?
e. What is the post-money valuation?

Make sure you specifically include a section in your submission that clearly states your answer to each question. I will not hunt through your spreadsheets or calculations to find your answers. If possible, please try to include only one document in your submission and please do not use embedded spreadsheets if you use a word document. Please label your assignment using our assignment labeling convention. Each question is worth three points.

Reference no: EM131135938

What was the capital gains yield

Suppose a stock had an initial price of $80 per share, paid a dividend of $1.35 per share during the year, and had an ending share price of $87. What was the capital gains y

Essentials of health care finance

Explain major objectives of healthcare financial management including generate income, respond to regulations, facilitate relationship with third-party payers,

Prepare a simple balance sheet of assets

Assume that Banc One receives a primary deposit of $1 million. The bank must keep reserves of 20 percent against its deposits. Prepare a simple balance sheet of assets and l

What is the arithmetic average excess return

What is the arithmetic average excess return and standard deviation of the returns for each stock? Remember, you should use excess returns to calculate standard deviation. T

Compute the weighted average cost of capital of the firm

A firm has a capital structure with $30 million in equity and $90 million of debt. The cost of equity capital is 10% and the pretax cost of debt is 6%. If the marginal tax r

Sections of introductory statistics

Exam grades across all sections of introductory statistics at a large university are approximately normally distributed with a mean of and a standard deviation of. Use the

What would be the weight used for equity

If the common shares are selling for $30 per share, the preferred share are selling for $15 per share, and the bonds are selling for 99 percent of par, what would be the wei

Social security is important for retirees

Discuss and support whether you believe Social Security is important for retirees and whether Social Security should be changed.Research Social Security systems in other cou


Write a Review

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