Use the tables for the question(s) below.
Estimated 2005 Income Statement and Balance Sheet Data for Ideko Corporation
The following are financial ratios for three comparable companies:

-Based upon the average EV/Sales ratio of the comparable firms,Ideko's target economic value is closest to:
A) $191 million
B) $155 million
C) $165 million
D) $157 million
E) $193 million

Question

Use the tables for the question(s) below.
Estimated 2005 Income Statement and Balance Sheet Data for Ideko Corporation
  The following are financial ratios for three comparable companies:
 
-Based upon the average EV/Sales ratio of the comparable firms,Ideko's target economic value is closest to:
A) $191 million 
B) $155 million 
C) $165 million 
D) $157 million 
E) $193 million

Quizplus · Accepted Answer

B) Average EV / Sales = 11ea7e5a_6eec_55fb_9a0a_b376566ed121_TB1623_11 = 2.07
EV = EV / Sales × Sales = 2.07 × $75 million = $155.25

Use the Tables for the Question(s) Below