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12 Cards in this Set
- Front
- Back
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Income Statement |
Financial Statement that Measures the profitability of the firm over a time period.
All expenses are subtracted from sales to arrive at net income. |
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Earnings per share |
The earnings available to common stockholders divided by the number of common stock shares available. |
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Price-earnings ratio (P/E ratio) |
The multiplier applied to earnings per share to determine current value.
It is influenced by the earnings and sales growth of the firm, risk of volatility of performance, the debt-equity structure, etc |
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Balance Sheet |
A Financial Statement that indicates what assets the firm owns and how those assets are financed in the form of liabilities or ownership interest. |
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Liquidity |
The relative convertibility of short-term assets to cash. |
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Net Worth, or Book Value |
SHE minus preferred stock ownership.
The Common stockholders' interest as represented by common stock par value, capital paid in excess of par, and retained earnings.
All Assets - liabilities - Preferred Stock= |
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Statement of Cash Flows |
The purpose is to emphasize the critical nature of cash flow to the operations of a firm. It translates accrual-based net income into actual cash dollars |
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Cash flows from operating activities |
Cash flow information that is determined by adjusting net income for such items as depreciation exp.,changes in current assets & liabilities, etc. Stated First |
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Cash flows from investing activities |
Cash flow that is generated (or reduced) from the sale or purchase of long-term securities such as Property, Plant, & Equipment. Stated Second |
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Cash flows from financing activities |
Cash flow that is generated (or reduced) from the sale or repurchase of stock (treasury stock) or the payment of dividends. Stated Third. |
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Depreciation |
The allocation of the initial cost of an asset over its useful life. The annual expense of plant and equipment is matched against the revenues that are being produced. |
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Free cash flow |
Cash flow from operating activities minus expenditures required to maintain the productive capacity of the firm minus dividend payouts |
