A company has a Market Cap of $500mm, Debt of $700mm, and Cash of $200mm. What is its Enterprise Value?

Enterprise value is $1,000mm. Start at the market cap of $500mm, add the $700mm of debt, subtract the $200mm of cash: 500 + 700 - 200 = 1,000. Same arithmetic read another way: $500mm of equity plus $500mm of net debt, where net debt is debt minus cash.

Enterprise value = 50. Net debt = 60. What is equity value? What does that mean?

Equity value is negative 10. Equity value equals enterprise value minus net debt, and net debt is total debt minus cash, so 50 minus 60 gives -10. The operating business is worth less than the debt claims that rank ahead of shareholders. On these numbers nothing is left over for equity. It is underwater by 10.

Can enterprise value be negative? How?

Yes, enterprise value can go negative. EV is equity value plus debt, plus preferred stock (a share class paid ahead of common shareholders), plus minority interest (the slice of a consolidated subsidiary the parent does not own), minus cash and equivalents. So EV goes negative once cash exceeds all of those added together. You see it in cash-rich, beaten-down companies, where the market values the operating business at less than nothing, typically because it expects that cash to be burned.

Why do you add noncontrolling interest when finding enterprise value?

You add noncontrolling interest because the consolidated statements pull in 100% of a subsidiary the parent controls but does not wholly own, while the parent's market cap pays for only its own slice of that subsidiary. Noncontrolling interest, sometimes called minority interest, is the piece of that subsidiary's equity the other owners hold. It sits as a line inside equity on the consolidated balance sheet. Add it and you put the value of the whole operating business against the earnings of the whole operating business. Consolidated EBITDA and enterprise value end up measuring the same thing.

What's the treasury stock method?

The treasury stock method is the standard way to convert options into shares for a diluted share count. Assume every in-the-money option gets exercised at its strike price. Then assume the company spends that exercise cash buying back its own stock at the current market price. Options exercised minus shares repurchased is the net new shares, and that is what you add to basic shares outstanding. An option is the right to buy a share at a fixed price, the strike. It is in the money when the market price sits above that strike.

If a company has a $15 share price, 10K shares outstanding, 5K options at a $12 strike price, and 5K RSUs, what are the fully diluted shares?

Fully diluted shares are 16,000. The 5,000 options are in the money at a $12 strike against a $15 price, so the treasury stock method applies: $60,000 of exercise proceeds comes in, repurchases 4,000 shares at $15, and leaves 1,000 net new shares. The 5,000 RSUs are restricted stock units, shares the company hands over as compensation with nothing for the holder to pay in. They generate no proceeds, so they are added in full. 10,000 + 1,000 + 5,000 = 16,000.

What is a valuation multiple, and what does P/E tell you?

A valuation multiple divides a measure of value by the financial metric that drives it. That puts companies of different sizes on one common scale. P/E is the most common one: share price divided by earnings per share, which is the same as market cap divided by net income. It tells you the price you pay today for one dollar of the company's current earnings. At a 20x P/E, investors are paying $20 for each $1 of annual profit.

Tell me whether these are more related to multiples of equity value or multiples of enterprise value: revenue, P/E, EBITDA.

Revenue and EBITDA are enterprise value multiples. P/E is an equity value multiple. Revenue and EBITDA both sit above interest expense on the income statement, so they are profit available to every provider of capital, debt and equity together, and that is exactly what enterprise value measures. The E in P/E is net income, struck after interest has been paid to lenders. It belongs to shareholders alone, and it pairs with equity value, or market cap.

What are the 3 main valuation methods and how do they rank?

The three core methods are comparable companies analysis (comps), precedent transactions, and the discounted cash flow (DCF). Comps and precedents are relative: they price your company off what similar companies trade for today, or off what they sold for in past deals. The DCF is intrinsic, built from the company's own projected cash flows. On ranking, precedent transactions usually come out highest, because they carry a control premium. The DCF has no fixed place in the range. It lands wherever its assumptions put it.

Intrinsic vs. relative valuation: which is better?

Neither one wins in general. They answer different questions, so bankers run both and triangulate: they look for the range where the two approaches overlap. Intrinsic valuation, mainly the discounted cash flow, values the company off its own projected unlevered free cash flows discounted at WACC, so it reflects the business on your assumptions and not on today's market mood. Relative valuation prices the company off multiples: what investors pay today for similar public companies, and what acquirers paid in past deals for similar companies. That anchors it in observed prices, but it imports whatever the market has already priced in, and it depends on which companies you chose as the comparison set.

How do you pick the comparable companies for a comps set?

Match the business first, then narrow hard. Start with companies that make money the same way the target does, filter on size, growth, margins, and geography, and land on roughly five to ten names you can defend individually. A comparable companies set ('comps') is a group of public peers whose trading multiples you apply to your target, so the answer is only as good as the similarity of the companies you put in. Quality beats quantity here. Adding loosely related names does not make the answer more reliable. It dilutes the few companies that actually trade the way your target should.

Describe precedent transaction methodology.

Precedent transactions, also called transaction comps, value a company off the multiples acquirers paid to buy similar companies in past M&A deals. You screen those deals for industry, size, and recency. For each one you build the transaction enterprise value, what the buyer paid for the equity plus the target's net debt at the time, and divide it by that target's financials as of the announcement. Apply the resulting multiple range to your own company's metric and you get an implied enterprise value, equity value, and price per share. These are prices paid for control of an entire company, so they typically carry a control premium, the amount above the pre-deal trading price a buyer pays to own and direct the whole business. That is why the range usually sits above where similar public companies trade today.

A company has a Market Cap of $500mm, Debt of $700mm, and Cash of $200mm. What is its Enterprise Value?

Enterprise value is $1,000mm. Start at the market cap of $500mm, add the $700mm of debt, subtract the $200mm of cash: 500 + 700 - 200 = 1,000. Same arithmetic read another way: $500mm of equity plus $500mm of net debt, where net debt is debt minus cash.

Enterprise value = 50. Net debt = 60. What is equity value? What does that mean?

Equity value is negative 10. Equity value equals enterprise value minus net debt, and net debt is total debt minus cash, so 50 minus 60 gives -10. The operating business is worth less than the debt claims that rank ahead of shareholders. On these numbers nothing is left over for equity. It is underwater by 10.

Can enterprise value be negative? How?

Yes, enterprise value can go negative. EV is equity value plus debt, plus preferred stock (a share class paid ahead of common shareholders), plus minority interest (the slice of a consolidated subsidiary the parent does not own), minus cash and equivalents. So EV goes negative once cash exceeds all of those added together. You see it in cash-rich, beaten-down companies, where the market values the operating business at less than nothing, typically because it expects that cash to be burned.

Why do you add noncontrolling interest when finding enterprise value?

You add noncontrolling interest because the consolidated statements pull in 100% of a subsidiary the parent controls but does not wholly own, while the parent's market cap pays for only its own slice of that subsidiary. Noncontrolling interest, sometimes called minority interest, is the piece of that subsidiary's equity the other owners hold. It sits as a line inside equity on the consolidated balance sheet. Add it and you put the value of the whole operating business against the earnings of the whole operating business. Consolidated EBITDA and enterprise value end up measuring the same thing.

What's the treasury stock method?

The treasury stock method is the standard way to convert options into shares for a diluted share count. Assume every in-the-money option gets exercised at its strike price. Then assume the company spends that exercise cash buying back its own stock at the current market price. Options exercised minus shares repurchased is the net new shares, and that is what you add to basic shares outstanding. An option is the right to buy a share at a fixed price, the strike. It is in the money when the market price sits above that strike.

If a company has a $15 share price, 10K shares outstanding, 5K options at a $12 strike price, and 5K RSUs, what are the fully diluted shares?

Fully diluted shares are 16,000. The 5,000 options are in the money at a $12 strike against a $15 price, so the treasury stock method applies: $60,000 of exercise proceeds comes in, repurchases 4,000 shares at $15, and leaves 1,000 net new shares. The 5,000 RSUs are restricted stock units, shares the company hands over as compensation with nothing for the holder to pay in. They generate no proceeds, so they are added in full. 10,000 + 1,000 + 5,000 = 16,000.

What is a valuation multiple, and what does P/E tell you?

A valuation multiple divides a measure of value by the financial metric that drives it. That puts companies of different sizes on one common scale. P/E is the most common one: share price divided by earnings per share, which is the same as market cap divided by net income. It tells you the price you pay today for one dollar of the company's current earnings. At a 20x P/E, investors are paying $20 for each $1 of annual profit.

Tell me whether these are more related to multiples of equity value or multiples of enterprise value: revenue, P/E, EBITDA.

Revenue and EBITDA are enterprise value multiples. P/E is an equity value multiple. Revenue and EBITDA both sit above interest expense on the income statement, so they are profit available to every provider of capital, debt and equity together, and that is exactly what enterprise value measures. The E in P/E is net income, struck after interest has been paid to lenders. It belongs to shareholders alone, and it pairs with equity value, or market cap.

What are the 3 main valuation methods and how do they rank?

The three core methods are comparable companies analysis (comps), precedent transactions, and the discounted cash flow (DCF). Comps and precedents are relative: they price your company off what similar companies trade for today, or off what they sold for in past deals. The DCF is intrinsic, built from the company's own projected cash flows. On ranking, precedent transactions usually come out highest, because they carry a control premium. The DCF has no fixed place in the range. It lands wherever its assumptions put it.

Intrinsic vs. relative valuation: which is better?

Neither one wins in general. They answer different questions, so bankers run both and triangulate: they look for the range where the two approaches overlap. Intrinsic valuation, mainly the discounted cash flow, values the company off its own projected unlevered free cash flows discounted at WACC, so it reflects the business on your assumptions and not on today's market mood. Relative valuation prices the company off multiples: what investors pay today for similar public companies, and what acquirers paid in past deals for similar companies. That anchors it in observed prices, but it imports whatever the market has already priced in, and it depends on which companies you chose as the comparison set.

How do you pick the comparable companies for a comps set?

Match the business first, then narrow hard. Start with companies that make money the same way the target does, filter on size, growth, margins, and geography, and land on roughly five to ten names you can defend individually. A comparable companies set ('comps') is a group of public peers whose trading multiples you apply to your target, so the answer is only as good as the similarity of the companies you put in. Quality beats quantity here. Adding loosely related names does not make the answer more reliable. It dilutes the few companies that actually trade the way your target should.

Describe precedent transaction methodology.

Precedent transactions, also called transaction comps, value a company off the multiples acquirers paid to buy similar companies in past M&A deals. You screen those deals for industry, size, and recency. For each one you build the transaction enterprise value, what the buyer paid for the equity plus the target's net debt at the time, and divide it by that target's financials as of the announcement. Apply the resulting multiple range to your own company's metric and you get an implied enterprise value, equity value, and price per share. These are prices paid for control of an entire company, so they typically carry a control premium, the amount above the pre-deal trading price a buyer pays to own and direct the whole business. That is why the range usually sits above where similar public companies trade today.

Intermediate Investment Banking Interview Questions

Q: What are intermediate investment banking interview questions?

Intermediate IB interview questions combine accounting, valuation, capital structure, and M&A logic. Examples include depreciation flow-through, WACC, DCF sensitivities, working capital, enterprise value bridge questions, and basic accretion/dilution.

Q: How are intermediate IB questions different from beginner questions?

Beginner questions test definitions and basic frameworks. Intermediate questions test cause and effect, such as how one accounting change flows through the statements or why a DCF valuation moves when an assumption changes.

Q: How should I answer DCF and WACC questions quickly?

Use a fixed structure: state the purpose, walk through the formula or steps, then explain the intuition. For DCF, focus on projecting UFCF, terminal value, discounting at WACC, and bridging to equity value. For WACC, focus on market-value weights, cost of equity, after-tax cost of debt, and why it matches unlevered cash flow.

Q: Are accretion/dilution questions intermediate or advanced?

Basic accretion/dilution is intermediate. You should know whether a cash, debt, or stock deal is accretive based on target earnings, financing cost, buyer multiple, purchase multiple, and share issuance. Complex merger model adjustments are advanced.

Q: When should I move from intermediate to advanced IB questions?

Move on when you can answer DCF, WACC, EV bridge, depreciation, working capital, and basic accretion/dilution without losing the direction of the impact.

Q: What is the most common intermediate investment banking question that trips candidates up?

The depreciation flow-through question - what happens to the three statements if depreciation increases by 10 - catches more intermediate candidates than any other single prompt. Most miss the cash flow direction or the impact on net income vs. EBITDA. Practice the answer in fixed order: income statement, cash flow statement, balance sheet.

Q: How do I know I am ready for advanced IB technicals?

You are ready when you can answer the canonical intermediate questions (DCF sensitivities, WACC, working-capital flow, EV bridge, basic accretion/dilution) in under 60 seconds without rebuilding intuition mid-answer. If you still pause to derive the direction of an assumption change, stay on intermediate.

A practical article-style question list for candidates who know the definitions and need to connect the mechanics.

By Michael Neal12 min readGOBLIN100 Questions 44-5512 written answersLast updated May 6, 2026

Intermediate investment banking interview questions test linkage: how one change in accounting, valuation, capital structure, or deal math moves the rest of the answer.

GOBLIN100 Questions 44-55

Use this intermediate list when the basic definitions are stable. Each answer should state the direction of impact and then explain why. These are positions 44-55 of the ordered GOBLIN100 ramp.

GOBLIN100 #44Evercore/ 1st Round
A company has a Market Cap of $500mm, Debt of $700mm, and Cash of $200mm. What is its Enterprise Value?
Enterprise value is $1,000mm. Start at the market cap of $500mm, add the $700mm of debt, subtract the $200mm of cash: 500 + 700 - 200 = 1,000. Same arithmetic read another way: $500mm of equity plus $500mm of net debt, where net debt is debt minus cash.
Work full answer in app
GOBLIN100 #45Centerview Partners/ 1st Round/ Generalist
Enterprise value = 50. Net debt = 60. What is equity value? What does that mean?
Equity value is negative 10. Equity value equals enterprise value minus net debt, and net debt is total debt minus cash, so 50 minus 60 gives -10. The operating business is worth less than the debt claims that rank ahead of shareholders. On these numbers nothing is left over for equity. It is underwater by 10.
Work full answer in app
GOBLIN100 #46Moelis/ 1st Round/ Technology
Can enterprise value be negative? How?
Yes, enterprise value can go negative. EV is equity value plus debt, plus preferred stock (a share class paid ahead of common shareholders), plus minority interest (the slice of a consolidated subsidiary the parent does not own), minus cash and equivalents. So EV goes negative once cash exceeds all of those added together. You see it in cash-rich, beaten-down companies, where the market values the operating business at less than nothing, typically because it expects that cash to be burned.
Work full answer in app
GOBLIN100 #47PJT Partners/ 1st Round/ Generalist
Why do you add noncontrolling interest when finding enterprise value?
You add noncontrolling interest because the consolidated statements pull in 100% of a subsidiary the parent controls but does not wholly own, while the parent's market cap pays for only its own slice of that subsidiary. Noncontrolling interest, sometimes called minority interest, is the piece of that subsidiary's equity the other owners hold. It sits as a line inside equity on the consolidated balance sheet. Add it and you put the value of the whole operating business against the earnings of the whole operating business. Consolidated EBITDA and enterprise value end up measuring the same thing.
Work full answer in app
GOBLIN100 #48OFFERGOBLIN
What's the treasury stock method?
The treasury stock method is the standard way to convert options into shares for a diluted share count. Assume every in-the-money option gets exercised at its strike price. Then assume the company spends that exercise cash buying back its own stock at the current market price. Options exercised minus shares repurchased is the net new shares, and that is what you add to basic shares outstanding. An option is the right to buy a share at a fixed price, the strike. It is in the money when the market price sits above that strike.
Work full answer in app
GOBLIN100 #49Perella Weinberg Partners/ 1st Round/ Technology
If a company has a $15 share price, 10K shares outstanding, 5K options at a $12 strike price, and 5K RSUs, what are the fully diluted shares?
Fully diluted shares are 16,000. The 5,000 options are in the money at a $12 strike against a $15 price, so the treasury stock method applies: $60,000 of exercise proceeds comes in, repurchases 4,000 shares at $15, and leaves 1,000 net new shares. The 5,000 RSUs are restricted stock units, shares the company hands over as compensation with nothing for the holder to pay in. They generate no proceeds, so they are added in full. 10,000 + 1,000 + 5,000 = 16,000.
Work full answer in app
GOBLIN100 #50OFFERGOBLIN
What is a valuation multiple, and what does P/E tell you?
A valuation multiple divides a measure of value by the financial metric that drives it. That puts companies of different sizes on one common scale. P/E is the most common one: share price divided by earnings per share, which is the same as market cap divided by net income. It tells you the price you pay today for one dollar of the company's current earnings. At a 20x P/E, investors are paying $20 for each $1 of annual profit.
Work full answer in app
GOBLIN100 #51Moelis/ 1st Round/ Technology
Tell me whether these are more related to multiples of equity value or multiples of enterprise value: revenue, P/E, EBITDA.
Revenue and EBITDA are enterprise value multiples. P/E is an equity value multiple. Revenue and EBITDA both sit above interest expense on the income statement, so they are profit available to every provider of capital, debt and equity together, and that is exactly what enterprise value measures. The E in P/E is net income, struck after interest has been paid to lenders. It belongs to shareholders alone, and it pairs with equity value, or market cap.
Work full answer in app
GOBLIN100 #52Miller Buckfire/ 1st Round/ Restructuring
What are the 3 main valuation methods and how do they rank?
The three core methods are comparable companies analysis (comps), precedent transactions, and the discounted cash flow (DCF). Comps and precedents are relative: they price your company off what similar companies trade for today, or off what they sold for in past deals. The DCF is intrinsic, built from the company's own projected cash flows. On ranking, precedent transactions usually come out highest, because they carry a control premium. The DCF has no fixed place in the range. It lands wherever its assumptions put it.
Work full answer in app
GOBLIN100 #53OFFERGOBLIN
Intrinsic vs. relative valuation: which is better?
Neither one wins in general. They answer different questions, so bankers run both and triangulate: they look for the range where the two approaches overlap. Intrinsic valuation, mainly the discounted cash flow, values the company off its own projected unlevered free cash flows discounted at WACC, so it reflects the business on your assumptions and not on today's market mood. Relative valuation prices the company off multiples: what investors pay today for similar public companies, and what acquirers paid in past deals for similar companies. That anchors it in observed prices, but it imports whatever the market has already priced in, and it depends on which companies you chose as the comparison set.
Work full answer in app
GOBLIN100 #54OFFERGOBLIN
How do you pick the comparable companies for a comps set?
Match the business first, then narrow hard. Start with companies that make money the same way the target does, filter on size, growth, margins, and geography, and land on roughly five to ten names you can defend individually. A comparable companies set ('comps') is a group of public peers whose trading multiples you apply to your target, so the answer is only as good as the similarity of the companies you put in. Quality beats quantity here. Adding loosely related names does not make the answer more reliable. It dilutes the few companies that actually trade the way your target should.
Work full answer in app
GOBLIN100 #55Citi/ 1st Round
Describe precedent transaction methodology.
Precedent transactions, also called transaction comps, value a company off the multiples acquirers paid to buy similar companies in past M&A deals. You screen those deals for industry, size, and recency. For each one you build the transaction enterprise value, what the buyer paid for the equity plus the target's net debt at the time, and divide it by that target's financials as of the announcement. Apply the resulting multiple range to your own company's metric and you get an implied enterprise value, equity value, and price per share. These are prices paid for control of an entire company, so they typically carry a control premium, the amount above the pre-deal trading price a buyer pays to own and direct the whole business. That is why the range usually sits above where similar public companies trade today.
Work full answer in app

What this level tests

DCF assumption sensitivity
WACC and discount rate logic
Enterprise value versus equity value
Working capital and free cash flow
Basic accretion/dilution math

This is the band that decides whether you progress to Superdays. Banks expect you to connect formulas to direction - not just recite WACC, but show what happens when WACC moves. Get fluent with the why behind every line.

How to know you are ready

You can state the valuation or EPS direction before explaining the math.
You can bridge DCF, WACC, EV, equity value, and working capital without losing the thread.
You can explain why the formula works, not just what the formula is.
You can recover if an interviewer flips one assumption.

Intermediate vs other question levels

Level	Example prompts	Ready when
Beginner	What does an investment bank do? What is enterprise value? Walk me through a DCF.	You can explain the concept cleanly before the first follow-up.
Intermediate	What happens if taxes fall in a DCF? How do AP days affect valuation?	You can connect formulas to valuation direction and name the trap.
Advanced	Calculate the LBO IRR. Why would a buyer not pay away all synergy value?	You can answer under pressure and defend the assumption set.

Keep practicing in the full bank.

The samples above are public. The full question bank and adaptive engine live in the practice app.

This intermediate investment banking interview question set pairs each prompt with a written direct answer, GOBLIN100 position, and bank context so candidates can compare question difficulty before moving into the full OFFERGOBLIN practice bank.