Use the tables for the question(s)below.
Pro Forma Income Statement for Ideko,2010-2015
Pro Forma Balance Sheet for Ideko,2010-2015

-Assuming that Ideko has a EBITDA multiple of 9.4,then the continuation enterprise value of Ideko in 2015 is closest to:
A)$181.7 million
B)$152.8 million
C)$272.8 million
D)$301.7 million
E)$114.6 million

Question

Use the tables for the question(s)below.
Pro Forma Income Statement for Ideko,2010-2015
  Pro Forma Balance Sheet for Ideko,2010-2015
 
-Assuming that Ideko has a EBITDA multiple of 9.4,then the continuation enterprise value of Ideko in 2015 is closest to:
A)$181.7 million 
B)$152.8 million 
C)$272.8 million 
D)$301.7 million 
E)$114.6 million

Quizplus · Accepted Answer

Continuation enterprise value = EBITDA multiple × EBITDA
From the pro forma income statement, we can see that Ideko's EBITDA for 2015 is $32.2 million.
Therefore, the continuation enterprise value in 2015 would be:
9.4 × $32.2 million = $302.68 million or approximately $301.7 million.
Therefore, the closest answer choice is D.

Use the Tables for the Question(s)below