Question: At her death Abigail owned 55 of the stock in

At her death, Abigail owned 55% of the stock in Finch Corporation, with the balance held by family members. In the past five years, Finch has earned average net profits of $1.6 million, and on the date of Abigail’s death, the book value of its stock is $3.8 million. An appropriate rate of return for the type of business Finch is in is 8%.
a. Assuming that goodwill exists, what is the value of the Finch stock?
b. What factors could be present to reduce the value of such goodwill?



Sale on SolutionInn
Sales0
Views51
Comments
  • CreatedSeptember 09, 2015
  • Files Included
Post your question
5000