P$7\mathrm{.}1$ Excess Earnings Valuation$-$Two$-$Year Investment Life$-$The One$-$Shot Tee$-$Shirt Company: At the end

of Year $0,$ an investor creates a company by investing $$1,500$ in cash for stock, and the company uses all of the

cash to buy $t-$shirts $($inventory$).$ At the end of Year $1,$ the company sells the $t-$shirts to a vendor for $$2,420$ but

does not collect the revenue in cash until the end of Year $2.$ At the end of Year $2,$ the company liquidates itself by

paying a liquidating dividend. The company has no operating expenses other than those related to the inventory

$($cost of goods sold$)$ and does not pay income taxes. We show the company's income statement and balance sheet

forecasts in Exhibit P$7\mathrm{.}1.$ For all parts of this problem, assume a discount rate of $10\%.$

a$.$ Value the company as of the end of Year $0$ using the discounted cash flow valuation model.

b$.$ Value the company as of the end of Year $0$ using the excess cash flow valuation method.

c$.$ Value the company as of the end of Year $0$ using the residual earnings valuation method.