Discussion
Purpose It is simply good business to continually know the cash value (corporate valuation) of your company.
EXERCISE 8C Determine the Cash Value of Coca-Cola
Purpose It is simply good business to continually know the cash value (corporate valuation) of your company. This exercise gives you practice in determining the total worth of a company using several methods. To perform this analysis, use Coca-Cola’s financial statements as given in the Cohesion Case.
Instructions
Step: 1 Calculate the financial worth of Coca-Cola based on four approaches: (1) the net worth method, (2) the net income method, (3) the price-earnings ratio method, and (4) the out-standing shares method.
Step 2: Get an average of the four methods. In a dollar amount, how much is Coca-Cola worth?
Step 3: Compare your analyses and conclusions with those of other students.
Answer preview Purpose It is simply good business to continually know the cash value (corporate valuation) of your company.
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