You are a financial analyst at SilverBaggs, a major investment banking firm. Your supervisor has just handed you a difficult assignment. You must review the work of an intern, who after given the pro forma income statement and pro forma balance sheet was asked to prepare a valuation. This intern is known to make at least 10 mistakes on each valuation attempted. Your boss wants you to identify those specific errors, suggest how they should have been done but do NOT calculate the correction, nor challenge the assumptions underlying the valuation.

Mississippi Partners is interested in buying Pacific Snacks, publicly traded firm. They have asked SilverBaggs to conduct a valuation of Pacific Snacks. Pacific Snacks has enjoyed low but consistent growth. Mississippi Partners believes they can improve margins by better pricing, improve asset management, and increase sales by a wider geographical distribution.