Yew Ltd
Income statement
31st october 2o19
m Turnover
153.6
cost of sales
(102.4)
Gross Profit
51.2
dmin Expenses
[15.9)
selling & Distribution Expenses
(8.1)
operating Profit
27.2
Finance costs
(2.1)
Profit Before Tax
25.1
Tax
(7.9)
Profit After Tax
17.2
Dividend Paid
(8.2)
Retained Profit
9.o
statement of Financial Position
31st october 2o19
Non current Assets
fm
Freehold land & buildings
33.2
Plant & equipment
24.3
Fixtures & fittings
10.467.9
current 4ssets
inventory
34.8
Trade receivables
29.664.4132.3
current Liabilities
Trade payables
35.9
Tax
3.9
Bank overdraft
11.4512
Total Assets - current Liabilities
81.1
Non-current Liabilities
10% loan
21.0
Equitv
ordinary shares
10.0
share premium
5.0
Retained Profit
45.160.1
Total Equity + Non current Liabilities
81.1

Note:

The nominal value of the shares is 50p

Further Information

Independent valuers have assessed current realisable values of assets as:

	£m
Freehold land & buildings	65.4
Plant & equipment	18.8
Fixtures & fittings	4.6
Inventory	38.9
Trade receivables	Value as SoFP

A similar business to Yew Ltd is listed on the LSE with a price earnings ratio of 10.

Required

Your boss has asked you to value the business using a variety of methods as described below:

Balance Sheet (net book value) method

(i) Calculate the number of shares that Yew Ltd has: million

(ii) What is the Net Assets using Balance Sheet Values? £m

(iii) What is the value of one share in Yew Ltd using the Balance Sheet (net book value) method?

Liquidation basis

(iv) What is the value of the Net Assets at Realisable Value? £ m

(v) What is the value of one share in Yew Ltd using the Liquidation basis method?

What is the value of one share in Yew Ltd using the P/E basis method?

Answer rating: 100% (QA)

To answer your questions lets go through each method step by step i Calculate the number of shares that Yew Ltd has To calculate the number of shares we need to divide the equity by the nominal value ... View the full answer