Use the table for the question(s)below.

-Refer to the statement of financial position above.If in 2015 Luther has 10.2 million shares outstanding and these shares are trading at $16 per share,then what is Luther's enterprise value?
A)-$63.3 million
B)$353.1 million
C)$389.7 million
D)$516.9 million
E)$163.2 million

Question

Use the table for the question(s)below.
  
-Refer to the statement of financial position above.If in 2015 Luther has 10.2 million shares outstanding and these shares are trading at $16 per share,then what is Luther's enterprise value?
A)-$63.3 million 
B)$353.1 million 
C)$389.7 million 
D)$516.9 million 
E)$163.2 million

Quizplus · Accepted Answer

Enterprise value (EV) is calculated by adding market capitalization (total number of outstanding shares multiplied by the market price per share) to total debt, minority interest, and preferred shares, and then subtracting total cash and cash equivalents. 
In this case, the market capitalization would be 10.2 million shares X $16 per share = $163.2 million.
Adding up the total debt, minority interest, and preferred shares from the table yields $142.5 million. Subtracting the total cash and cash equivalents of $16.8 million gives us an EV of $389.7 million. Therefore, the correct option is C.

Use the Table for the Question(s)below