Multinational finance and accounting Essay Example | Topics and Well Written Essays - 3000 words

Multinational finance and accounting - Essay Example 5. (the forecast of proceeds is revised downward here because the equity investment of the subsidiary is less; the buyer would be assuming more debt if part of the initial investment in the subsidiary is supported by local bank loans). 6. Required parent's rate of return 18 percent. To Find Present Payment, Given Future Required Amount Given: Interest 18 18 18 18 18 18 Number of years 1 2 3 4 5 6 Present Value Interest Factor 0.847457627 0.71818443 0.608630873 0.515788875 0.437109216 0.370431539 Initial Investment 40,000,000.00 Initial Investment in Marks at $.50 per mark 80,000,000.00 Net Cash Flow 8,000,000.0010,000,000.0014,000,000.0016,000,000.0016,000,000.0016,000,000.00 Net Cash to Parent 4,000,000.005,000,000.007,000,000.008,000,000.008,000,000.008,000,000.00 Net Cash to Parent after tax 3,600,000.004,500,000.006,300,000.007,200,000.007,200,000.007,200,000.00 Salvage After 6 years 30000000 Exchange Rate1