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25 Cards in this Set
- Front
- Back
- 3rd side (hint)
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Calculate Average Collection Period |
Receivables and start of year / average daily sales |
Average daily sales = [income statement] net sales / 365 |
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Calculate Average days sales in Inventory |
Inventory at start of year / (COGS / 365) |
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Calculate Current Ratio |
Current Assets / Current Libilities |
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Calculate Quick Ratio |
(Cash + Marketable securities + Receivables) / Current Liabilities |
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Calculate Cash Ratio |
Cash + Marketable securities / Current Liabilities |
Similar to quick ratio but without receivables |
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Calculate Return on Assets [ROA] |
After tax operating income / total assets |
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After Tax operating Income |
(1-tax rate) x Interest Expense + Net Income |
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Calculate Return on Equity [ROE] |
Net Income / Equity |
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Calculate Profit Margin |
Net Income / Sales |
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Find EFR: given increase in assets & payout ratio WITH EXAMPLE |
NI=RE+Div - 220=120+100 NA=RE+EF - 200=120+80 EF=NE+ND - 80=0+80 |
ex. g=10%; div=100; Investment=200; Total on Balance sheet = 2000 |
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Find new div payment with new rules and new growth (#10 s.g.) WITH EXAMPLE |
New Dividend payment = 280 |
NI = 750; Debt=1600; Total on Balance Sheet= 3600; Payout=50%; Growth=20% |
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Find how much New Equity must be issued with new growth and new rules WITH EXAMPLE |
New E = 60 |
Growth=10%; Div=180; New Debt=$100; Total on Balance Sheet=2000; NI=200 |
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Calculate Sustainable Growth Rate |
Plowback Ratio x Return on Equity |
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Calculate Plowback Ratio [rt. sustainable growth] |
1-payout ratio
payout ratio = dividends / NI |
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Given APR find EAR WITH EXAMPLE |
EAR=FV=12.68 12n, 1%i, -1PV, 0PMT, FV____ |
APR=12%
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Given EAR find APR WITH EXAMPLE |
APR=ix12months=7.7208 12n, i____, -1PV, 0PMT, 1.08PV |
EAR=8% |
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Calculate WACC |
[D/V x rDebt (1-Tc)]+E/V x rEquity |
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Calculate CAPM WITH EXAMPLE |
CAPM=6.8% r= rF + B (rM - rF) |
Risk Free=4%; B=.4, R Market=11% |
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Calculate CAPM then find PV of Perpetuity |
CAPM=15.2% PV of Perpetuity = -25.29 CAPM=4%+1.4(12%-4%) PV of Perp= 10n, 15.2i, -100 STO 0, 15 STO(1-10), FPV_____ |
Year 0 cash flow = -100 Years 1-10 cash flow = 15 B=1.4; Risk free=4%; Market Return=12% |
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Calculate WACC WITH EXAMPLE |
WACC=13.67 Debt= 8.75mil = 1.25x7mil Equity= 25mil = $50per share x (18mil/$36per share) Total = 33.75 = 8.75+25 WACC= [(8.75/33.75) x .10 x (1.30%)] + [(25/33.75) x 16%] |
Book Value equity=18m Book value per share=$36 Sell stock at 50/share Cost of equity=16% Bond face value=7mil Sell at 125% of face value YTM=10% Tc=30% |
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Calculate NPV |
N, i, STO, F, PV EX. 3n, 7%i, 0 STO0, 25,000 STO (1-2), 45,000 STO3, F, PV = 432941.95 |
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Calculate IRR |
N, CHS STO, F, FV 2N, 30CHS STO 0, 21 STO (1-2), F, FV = 25.69% IRR |
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Calculate EAA |
Find NPV, the hit CHS, PV, PMT EX. 5N, 12i, 17,000 CHS STO 0, 27,000 CHS STO (1-5), F, PV, PV, PMT |
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Calculate Profitability Index |
NPV / Initial Investment SOLVE FOR NPV THEN DIVIDE BY STO 0 |
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Calculate Payback Period |
Initial Investment / yearly costs Year Project A Project B 0 -360 -360 1 190 260 2 190 260 Payback = 360/190 360/260 = 1.89 1.38 |
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