The Impact of Yearly Increasing Minimum Wages on the Value of a Firm Using Free Cash Flow to the Firm Method and on Shareholder Value Added: a Case Study of PT. Gondowangi Tradisional Kosmetika

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The Impact of Yearly Increasing Minimum Wages on the Value of a Firm Using Free Cash Flow to the Firm Method and on Shareholder Value Added: a Case Study of PT. Gondowangi Tradisional Kosmetika

Tania - Personal Name; Faradynawati, Ida Ayu Agung - Personal Name;

In todays economic world, most businesses always face the condition of minimum wage increases every year. Some firms respond to these higher labor costs by reducing employment, relocating the business, or raising prices that lead to the firms value and performance. the objectives of this thesis are to define and examine the approaches using Free Cash Flow to the Firm (FCFF) method for firm valuation and to identify the value and wealth creation for shareholders by Shareholder Value Added (SVA) concept in PT. Gondowangi Tradisional Kosmetika. This research is a descriptive study and a causal study using quantitative approach and the data are obtained from secondary sources. the financial statements of PT. Gondowangi Tradisional Kosmetika are analyzed using financial modeling in Microsoft Excel. Thus, the value of the firm is obtained using the FCFF method and the shareholdersΓÇÜ├ä├╢?├æ?┬Ñ value added is obtained using the SVA method. the results of the valuation indicate that there was a sharp different in the firms value and shareholdersΓÇÜ├ä├╢?├æ?┬Ñ value added when using different assumptions in scenario analysis (i.e. optimist, normal, and pessimist). From those results can be seen the potential in the future for the firm in which the minimum wages increases annually and ensure that PT. Gondowangi Tradisonal Kosmetika will perform well as expected in the future.

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Detail Information

Series Title: -
Call Number: 1669
Publisher: : Swiss German University., 2014
Collation: -
Language: English
ISBN/ISSN: -
Classification: NONE
Content Type: -
Media Type: -
Carrier Type: -
Edition: -
Subject(s): IBA
Minimum wages
Free cash flow to the firm (FCFF)
Shareholder value added (SVA)
Valuation
Specific Detail Info: -
Statement of Responsibility: -

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