Finding Firm Value 'Quickly' with an Analysis of Debt

Posted: 16 Aug 2001

See all articles by Tom Arnold

Tom Arnold

University of Richmond - E. Claiborne Robins School of Business

Jerry James

Independent

Abstract

A firm value calculator (FVC) is introduced that is much faster than its pro forma counter-part. The additional benefit of this FVC over what is available in the existing literature is a direct analysis of the effect of leverage. The debt analysis is captured within both the firm's cash flow and the discount rate for the firm's cash flow. The calculator can be implemented on a hand-held calculator or on an Excel spreadsheet making the analysis very amenable to the classroom.

Keywords: pro forma, firm value, calculator

Keywords: pro forma, firm value, calculator

JEL Classification: G00, G39

Suggested Citation

Arnold, Thomas M. and James, Jerry W., Finding Firm Value 'Quickly' with an Analysis of Debt. Journal of Financial Education, Vol. 29, pp. 65-82, Winter 2003. Available at SSRN: https://ssrn.com/abstract=277171 or http://dx.doi.org/10.2139/ssrn.277171

Thomas M. Arnold (Contact Author)

University of Richmond - E. Claiborne Robins School of Business ( email )

1 Gateway Drive
Richmond, VA 23173
United States
804-287-6399 (Phone)
804-289-8878 (Fax)

Jerry W. James

Independent

No Address Available

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