extra equations/things i need to know

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  • Created by: jmf00632
  • Created on: 21-10-19 15:46
USE THE BALANCE SHEET/FINANCIAL STATEMENT OF POSITION EQUATION - it is?
NCA+CA=CL+NCL+E
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equity
toal assets - total liaibite
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net worth capital
current assets - current liabities
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interest cover ratio
(the answer comes in times (e.g. 13 tmes) this means twice as much as what the company owns?
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cost of goods sold same as -
cost of revenue
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cash equivalent same as
this includes cash and short term investnes
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sales is the same as....
revenue
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account reciebalbes same as
trade receivables
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net income.....
same as operating profit
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what is the current ratio and what does it measure?
is a liquidity ratio that measures whether a firm has enough resources to meet its short-term obligations.
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how do you get NWC (net working capital)
ca-cl
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there are times when you il need to put 0 at the front of fighures that you have been calc for example
cash and cash eq=761.3 turns into 76.130
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remember to put decimal point in the right place with an answer e.g.
071553 = 71.55 %!!
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operating profit
sales + COGS + expenses + depriciation
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profit before tax
operating profit - interest
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incoem statement...
sales, COGS, expenses, depriciation, operating profit. interest, profit before tax, tax, net income
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how do you work out operating profit?
sales + COGS + Expenses + depriciation
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how do you work out operating cash flow?
op profit + depriication - taxes
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earnings per share
Net income / number of shares
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FYI...
PRICE EARNING RATIO ANSWER IS IN TIMES
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what does earnings per share show
shows the earnings value attributable to one share. This is the return to shareholders per share and is either paid out in dividend or added to retained earnings
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what does price earning ratio (P/E) show?
measures how much investors are willing to pay per unit of current earnings. Here, investors are willing to pay a multiple of approximately 11 time earnings to purchase shares.
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what does PEG show
provides a comparison of P/E against projected growth to see if the P/E is too high or too low relative to this growth figure. Here the PEG is > 1, indicating that the shares may be overpriced in comparison to projected growth.
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what does market to book ratio reveal
compares the market value of the firm’s investments with their cost. A value greater than ‘1’ could mean that the firm has been successful overall in creating value for its shareholders over time.
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Book value
TE / NUMBER OF SHARES
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Market value per share
makret price per share / book value per share
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fyi ...
PEG ratio is expressed in times
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fyi..
if asked to calculate ROE and only given equity then / it where EM is and then x by 10
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ROS
EBIT / revnue x 100
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cash flow from investing activities
NCA 2013 - NCA 2012 + DEPRICIATION
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What is the dividend payout ratio?
this is the proportion of net income paid out as a dividend / dividend / net income
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what is b?
amount of net income retained
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how do you calc b (amount of net income retained)
1 - dividend payout ratio
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how to claculate projected increase in retained earnings -
1. first work out the net income. (pm x sales) 2.then workout the retained e.g. if 40 percent is paid out then 60 percent is retained 3. lastly, times the retained by the net icome
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first step for calc sustaianble growth rate -
1. find retained earnings (net incom - dividends)
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second step
2. find the equity at the end of the year (equity + retained earnings) (to find retained earnings you do n.i / dividends
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third step
you can now use the formula
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how can you raise money for external financing?
new borrowings, new shares, cutting or waving dividend
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Other cards in this set

Card 2

Front

equity

Back

toal assets - total liaibite

Card 3

Front

net worth capital

Back

Preview of the front of card 3

Card 4

Front

interest cover ratio

Back

Preview of the front of card 4

Card 5

Front

cost of goods sold same as -

Back

Preview of the front of card 5
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