easy · Investment Banking

When bridging from Equity Value to Enterprise Value, how should the company's Cash and Cash Equivalents be treated?

1. They should be subtracted because cash is a non-operating asset that offsets the cost of an acquisition.
2. They should be added only if the company has negative net working capital.
3. They should be ignored as cash is already reflected in the company's market capitalization.
4. They should be added because cash increases the total asset base of the business.

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