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When doing analysis on a potential LBO transaction which item is not true? O In the sources and uses table the existing debt of the target company (pre-transaction) is usually paid off and replaced with a new capital structure. O When setting the purchase price, as a general rule, the Buyer should be careful about assumptions relating to the Exit multiple (for example, it should not be significantly higher than the Entry multiple). O In an LBO model, the residual equity cash flows should be discounted at the pre- transaction WACC of the target business. O When calculating maximum debt capacity, one should stress test the forecast (i.e. consider a downside scenario) to make sure that the company can manage the heavy debt load