You are trying to value WES shares today (end of 2021). Assume the current price of WES shares are $49.97. Assume that the total dividend paid by WES in 2021 was a lump sum. You also estimate that for the next two years dividends will grow respectively at 50% and 25% per year. After this (starting in time 3) you estimate dividends will grow at a constant rate of 3.5% forever. Assume that today the Australian 10 year government bond has a yield of 1.15%, the market risk premium is 4.55% and the beta of WES is 0.72. Based on this price would you purchase WES shares? Why or why not?

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Part One: General Instructions for completion of the accounting cycle through an adjusted trial balance. > Skip a line between journal entries > Each T-account needs to have a title > Postings to T-accounts need a date next to the dollar amount > > Accounts listed in Trial Balance and T-accounts should be arranged in the following order: assets, liabilities, owner's equity, revenues, cost of goods sold and expenses. There is only one General Journal and one General Ledger (T-accounts), so don't worry about Subsidiary Ledgers or Special Journals for this assignment. T-accounts should have totals > Part I 1. Prepare journal entries to record each of the transactions on the next page. You do not need to write explanations below the journal entries. 2. Create T-accounts for each account in the chart of accounts and post each of the journal entries to an existing T-account. 3. Total the T-accounts 4. Prepare an unadjusted trial balance Part II 1. Prepare adjusting journal entries. Besides the information provided for adjusting journal entries, review the transactions and review your unadjusted trial balance for any other adjusting journal entries you may need to prepare. 2. Post the adjusting journal entries to the T-accounts you previously created. 3. Total the T-accounts 4. Prepare an adjusted trial balance 5. Prepare the following financial statements, in good form o Multistep Income Statement (you do not need to distinguish between selling expense and general & administrative expenses) Statement of Owner's Equity Classified Balance Sheet o o 6. Prepare closing entries 7. Prepare a post closing trial balance Transactions 7/1 7/2 7/2 7/3 7/3 7/3 7/4 7/5 7/6 7/15 7/16 7/17 7/18 7/18 7/18 7/28 7/28 Dan invested cash of $800,000 in the business. Purchased tire balancing equipment for $96,000. Purchased a wheel alignment rack for $450,000. Paid $7,500 to purchase 100 Firestone tires for passenger cars. Paid $15,000 to purchase 100 Goodyear truck tires. Paid $24,000 for 6 months rent paid in advance. Sold 40 truck tires for $200 each on account to SC County. Sold 36 truck tires for $200 each and 20 car tires for $100 each to Leak Tire Store. Sold 68 car tires for $100 each to Joe Customer. Paid our employees wages. Employees worked 400 hours at $12.50 per hour. SC County paid $8,000 on their account. Joe Customer paid $6,800 on his account. Leak Tire Store paid $9,200 on their account. Purchased 88 Firestone tires for passenger cars for $6,600, on account. Purchased 76 Goodyear truck tires for $11,400 on account. Paid $6,600, on our account with Firestone. Paid $11,400 on our account with Goodyear. Adjusting Entries 7/31 7/31 7/31 7/31 Accrue rent expense for the month Accrue depreciation expense on the balancing equipment ($3,000). Accrue depreciation expense on the alignment equipment ($10,000). Accrue wage expenses for the second half of the month. Employees again worked 400 hours at $12.50 per hour. Part One: General Instructions for completion of the accounting cycle through an adjusted trial balance. > Skip a line between journal entries > Each T-account needs to have a title > Postings to T-accounts need a date next to the dollar amount > > Accounts listed in Trial Balance and T-accounts should be arranged in the following order: assets, liabilities, owner's equity, revenues, cost of goods sold and expenses. There is only one General Journal and one General Ledger (T-accounts), so don't worry about Subsidiary Ledgers or Special Journals for this assignment. T-accounts should have totals > Part I 1. Prepare journal entries to record each of the transactions on the next page. You do not need to write explanations below the journal entries. 2. Create T-accounts for each account in the chart of accounts and post each of the journal entries to an existing T-account. 3. Total the T-accounts 4. Prepare an unadjusted trial balance Part II 1. Prepare adjusting journal entries. Besides the information provided for adjusting journal entries, review the transactions and review your unadjusted trial balance for any other adjusting journal entries you may need to prepare. 2. Post the adjusting journal entries to the T-accounts you previously created. 3. Total the T-accounts 4. Prepare an adjusted trial balance 5. Prepare the following financial statements, in good form o Multistep Income Statement (you do not need to distinguish between selling expense and general & administrative expenses) Statement of Owner's Equity Classified Balance Sheet o o 6. Prepare closing entries 7. Prepare a post closing trial balance Transactions 7/1 7/2 7/2 7/3 7/3 7/3 7/4 7/5 7/6 7/15 7/16 7/17 7/18 7/18 7/18 7/28 7/28 Dan invested cash of $800,000 in the business. Purchased tire balancing equipment for $96,000. Purchased a wheel alignment rack for $450,000. Paid $7,500 to purchase 100 Firestone tires for passenger cars. Paid $15,000 to purchase 100 Goodyear truck tires. Paid $24,000 for 6 months rent paid in advance. Sold 40 truck tires for $200 each on account to SC County. Sold 36 truck tires for $200 each and 20 car tires for $100 each to Leak Tire Store. Sold 68 car tires for $100 each to Joe Customer. Paid our employees wages. Employees worked 400 hours at $12.50 per hour. SC County paid $8,000 on their account. Joe Customer paid $6,800 on his account. Leak Tire Store paid $9,200 on their account. Purchased 88 Firestone tires for passenger cars for $6,600, on account. Purchased 76 Goodyear truck tires for $11,400 on account. Paid $6,600, on our account with Firestone. Paid $11,400 on our account with Goodyear. Adjusting Entries 7/31 7/31 7/31 7/31 Accrue rent expense for the month Accrue depreciation expense on the balancing equipment ($3,000). Accrue depreciation expense on the alignment equipment ($10,000). Accrue wage expenses for the second half of the month. Employees again worked 400 hours at $12.50 per hour.

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