Location: Idaho Falls, ID
The attached spreadsheet model is for Play It Again Sports located in Idaho Falls, Idaho. Play It Again Sports is listed at a sale price $260,000. We also included the purchase of the building and land that this company is located on at $600,000. This model includes a 10 year forecast of the balance sheet and income statement, based on market assumptions. The model allows variables to be changed for all major inputs of the computations.
With the input values we chose, Play It Again Sports would have a weighted average cost of capital (WACC) at 5.92% and an internal rate of return (IRR) of 6.13%. This was using 52% debt and 48% equity. Since the IRR is higher than the WACC, we believe that the sales price is reasonable. The only drawback for a potential buyer would be having a big enough down payment.