PERFORMANCE:ACEACMEACME/ACECOMBINEDAAASituationWidgetProduction(units)Sales(thousands)OperatingEarnings(thousands)Inefficient production; Substantialexcesscapacity75,000$95,000$5,0005.3%Inefficient production;Operatingatcapacity125,000$155,000$25,00016.1%Substantial operatingleverageathigherplant utilization200,000$250,000$75,00030.0%Inefficientproductionwithsubstantialexcesscapacity100,000$150,000$18,75015.0%VALUATIONS:30,000170,000$200,000150,000100,000$250,000450,000-$450,000112,500150,658$263,158112,500637,500$750,000112,500157,500$270,000IntrinsicValue(6Xmultiple)ImpliedStrategicValue TotalValue(thousands)VALUATIONMETRICS:2.140.02.71.610.02.01.86.02.32.140.02.7SalesMultipleOperatingEarningsMultipleProductionMultiple($/1000widgets)