16 Sterling Problem A:

Using the discounted free cash flow valuation model, Sterling Company's value of operations is estimated to be $380 million. The company's current year balance sheet shows $55 million in cash and $18 million in marketable securities. The balance sheet also shows $48 million in accounts payable, $93 million in notes payable, $9 million in deferred revenue, $33 million in long-term debt, $42 million in preferred stock, and $120 million in total common equity. The long-term debt has a current market value of $33.45 million while the market value of the preferred equity is $44 million.

Question: What's the company's enterprise value (in millions)?

O <390 Million

O Between 390 and 400 million

O Between 400 and 408 Million

Between 409 and 419 million

>$420 Million

Sterling Problem B

Using the discounted free cash flow valuation model, Sterling Company's value of operations is estimated to be $380 million. The company's current year balance sheet shows $55 million in cash and $18 million in marketable securities. The balance sheet also shows $48 million in accounts payable, $93 million in notes payable, $9 million in deferred revenue, $33 million in long-term debt, $42 million in preferred stock, and $120 million in total common equity. The long-term debt has a current market value of $33.45 million while the market value of the preferred equity is $44 million.

Question: What is the estimated market value of the company's common equity (in millions)?

O <$220 M

O Between 221 and 230 M

O Between 231 and 240 M

Between 241 and 249 M

249 M