WALL STREET PREP PREMIUM TEST EXAM 2026
NEWEST STUDY QUESTIONS WITH CORRECT
SOLUTIONS 100% GUARANTEED PASS | RATED A+
Use the following information to answer the question below:• Acquirer purchases 100% of target
by issuing $100 million in new debt to purchase target shares, carrying an interest rate of 10%
• Excess cash is used to help pay for the acquisition
• Acquirer expects to be able to close down several of the target company's old manufacturing
facilities and save an estimated $2 million in the first year
• Target PP&E is written up by $25 million to fair market value
• Investment bankers, accountants, and consultants on the deal earned $30 million in fees
Which of the following adjustments would be made to the pro forma income statement? -
Answer>>> Advisory fee expense of $30 million
A company has the following information:
• 2014 Revenues of $8 billion
• 2014 COGS of $5 billion
• 2013 Accounts receivable of $400 million
• 2014 Accounts receivable of $600 million
• 2013 Inventories of $1 billion
• 2014 Inventories of $800 million
• 2013 Accounts payable of $250 million
• 2014 Accounts payable of $300 million
What are the inventory days for the company? - Answer>>> 65.7 days
, Which of the following is true - Answer>>> Coca Cola's brand name is not reflected as an
intangible asset on its balance sheet
A company has the following information:
• 2014 share repurchase plan of $4 billion
• Average share price of $60 for the year 2013
• Expected EPS growth for 2014 of 10%
How much debt is paid down by the exit year (since the LBO announcement)? - Answer>>> 5.2
billion
On December 30, 2013:
• Company Y trades at $10 per share
• Enterprise Value / EBITDA multiple of 5.0x
• Leverage ratio of 0.6x (Net debt/EBITDA)
• 2013 EBITDA = $2.0 billion
• Assume no cash on company Y's balance sheet
On December 31, 2013:
• Company Y undergoes an LBO and is recapitalized
• The company's new leverage ratio becomes 5.0x
• Financial sponsor exit is planned for Year 5. Assume that the EV/ EBITDA multiple at exit
year is the same as the current multiple.
• Required rate of return is 25%
• Exit year EBITDA projected to be $3.0 billion
• The company's year-end leverage ratio is 1.6x
What is the initial equity necessary to achieve the rate of return required by the financial
sponsors? - Answer>>> 3.34 billion
NEWEST STUDY QUESTIONS WITH CORRECT
SOLUTIONS 100% GUARANTEED PASS | RATED A+
Use the following information to answer the question below:• Acquirer purchases 100% of target
by issuing $100 million in new debt to purchase target shares, carrying an interest rate of 10%
• Excess cash is used to help pay for the acquisition
• Acquirer expects to be able to close down several of the target company's old manufacturing
facilities and save an estimated $2 million in the first year
• Target PP&E is written up by $25 million to fair market value
• Investment bankers, accountants, and consultants on the deal earned $30 million in fees
Which of the following adjustments would be made to the pro forma income statement? -
Answer>>> Advisory fee expense of $30 million
A company has the following information:
• 2014 Revenues of $8 billion
• 2014 COGS of $5 billion
• 2013 Accounts receivable of $400 million
• 2014 Accounts receivable of $600 million
• 2013 Inventories of $1 billion
• 2014 Inventories of $800 million
• 2013 Accounts payable of $250 million
• 2014 Accounts payable of $300 million
What are the inventory days for the company? - Answer>>> 65.7 days
, Which of the following is true - Answer>>> Coca Cola's brand name is not reflected as an
intangible asset on its balance sheet
A company has the following information:
• 2014 share repurchase plan of $4 billion
• Average share price of $60 for the year 2013
• Expected EPS growth for 2014 of 10%
How much debt is paid down by the exit year (since the LBO announcement)? - Answer>>> 5.2
billion
On December 30, 2013:
• Company Y trades at $10 per share
• Enterprise Value / EBITDA multiple of 5.0x
• Leverage ratio of 0.6x (Net debt/EBITDA)
• 2013 EBITDA = $2.0 billion
• Assume no cash on company Y's balance sheet
On December 31, 2013:
• Company Y undergoes an LBO and is recapitalized
• The company's new leverage ratio becomes 5.0x
• Financial sponsor exit is planned for Year 5. Assume that the EV/ EBITDA multiple at exit
year is the same as the current multiple.
• Required rate of return is 25%
• Exit year EBITDA projected to be $3.0 billion
• The company's year-end leverage ratio is 1.6x
What is the initial equity necessary to achieve the rate of return required by the financial
sponsors? - Answer>>> 3.34 billion
