Kendra Enterprises has never paid a dividend. Free cash flow is projected to be $80,000 and $100,000 for the next 2 years, respectively; after the second year, FCF is expected to grow at a constant rate of 9%. The company's weighted average cost of capital is 14%.
1. What is the terminal, or horizon, value of operations?
(Hint: Find the value of all free cash flows beyond Year 2 discounted back to Year 2.) Round your answer to the nearest cent. $
2. Calculate the value of Kendra's operations.
Round your answer to the nearest cent. Do not round intermediate calculations.