Cleanteq Metal Recovery, which is specifically established for a joint venture agreement to extract gold, will end its corporate life in 3 years. Net Cash Flow expected during the years it still operate is at P3 million per year. At the end of its life, Cleanteq estimates to incur P10 million for closure and rehabilitation costs for its mining site and other costs related to the liquidation process. Cost of capital is set at 10%. Remaining assets by end of the corporate life will be bought by another company for P30 million and remaining debt of P4 million will be fully paid off by them. If the valuation happens now, compute for the value of Cleanteq Company.

Answer rating: 100% (QA)

To calculate the value of Cleanteq Company we can use the discounted cash flow DCF method 1 Calculat... View the full answer