Referring to Problem, assume it is now two years after the acquisition of Sparks, and you must perform a goodwill impairment test of the subsidiary. Growth expectations have been lowered to 3% going forward. Using the following five-year projection of cash flows and a 12% cost of equity, estimate the value of the subsidiary beyond year 5, the current value of the subsidiary, the current value of goodwill, and any goodwill impairment. Total assets (excluding intangibles) are now $612.5 million, and total liabilities are $175.0 million.
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