If a company has $80 million in equity and $20 million in debt, this means that total firm value = D + E = $100 million.
Am I then right to assume that if there are 1 million shares outstanding, then each share is worth $100? Or, do I have to subtract the $20 million debt from the equity, leaving the firm value to be $60 million, then each share is worth $60?
Can someone please help me out? Thanks.