Pearson connection inc is concerding the acquisition of, Ask an Expert

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PEARSON CONNECTION INC IS CONCERDING THE acquisition of Jones & bartlett inc(J&B) for $1.5 million in cash J&B has short term libilities of $500,000. As a result of acquiring J&B Pearson connections inc would acquire the copyrights to a widely used virtual textbook which would provide $300,000 in estimated cash flow per year for each of the next five years. the pearson has a cost of capital of 20%

1) Determine the approximate net present value of this acquisition.

2) how would this amount be used In a purchase for cash? Purchase for stock?

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92367222

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