FA and valuation

Question 1

% completion (revenue recognition)

Answer 1

(Costs incurred / Total expected costs) * Total expected revenue

Question 2

Diluted EPS

Answer 2

(NI - preferred dividend + converted pref. div. + conv. debt interest * (1-t) ) / (WA shares + newly created shares)

Question 3

Convertible debt interest * (1-t)

Answer 3

debt * par value * yield rate * (1-t)

Question 4

Newly created shares (options)

Answer 4

of options - ((# of options * exercise price) / current share price)

Question 5

Basic EPS

Answer 5

(NI - preferred dividend) / WA shares

Question 6

Dividend discount model (P)

Answer 6

Div1 / (re - g)

Question 7

Growth rate

Answer 7

ROE * Plowback

Question 8

Cost of equity

Answer 8

rf + beta_e*(rm-rf)

Question 9

ROE

Answer 9

NI/Sales * Sales/Assets * Assets/Equity

Question 10

P/EPS conversion

Answer 10

P0/EPS1 = Payout/(re-g)

Question 11

P/Book value

Answer 11

Market value / Book value

Question 12

Book value

Answer 12

Assets - Liabilities

Question 13

Abnormal profit model

Answer 13

1) Residual income = NI - reOp.BV(e) = (ROE-re)Op.BV(e)

2) V0 = BV(e) + Sum[RI/(1+re)^t]

Question 14

Residual income for TV

Answer 14

( (ROE - re) / (re - g) ) * Op.BV(e)

Question 15

Dividend discount model (V0)

Answer 15

Sum[Div/(1+re)^t] + TV

Question 16

ROE (multiples)

Answer 16

(P/BVe) / (P/EPS)

Question 17

Price (multiples approach i guess)

Answer 17

P = (EV - Dib) / Nosh

Question 18

FCFF method

Answer 18

EBIT*(1-t) + depr - CAPEX - △WC

Question 19

CAPEX

Answer 19

PPE1 - PPE0 + depr

Question 20

WACC

Answer 20

reE/A + rd(D/A)*(1-t)

Question 21

Cost of equity for FCFF

Answer 21

alpha + rf + beta_e*(rm-rf)

Question 22

Beta_e

Answer 22

Beta_a + D/E*(Beta_a - Beta_d)

Question 23

Terminal Value

Answer 23

FCFF*(1+g) / (WACC-g) / (1+WACC)^t

Question 24

MVe

Answer 24

EV - Dib

Question 25

P/E

Answer 25

P/EPS = MVe/NI

Question 26

Cost of equity 2nd

Answer 26

re = ra + D/E*(ra-rd)

Question 27

Closing equity

Answer 27

Cl. equity = Op. equity + NI - Dividends

Question 28

EBIT multiple

Answer 28

EBIT multiple = EV/EBIT

Question 29

Pre money

Answer 29

Pre money = Post money - Investments that round

Question 30

Ownership shares

Answer 30

Ow. shares = new shares / total shares = Investments / Post money

Question 31

Price per share

Answer 31

Price per share = Investment / # of shares

Question 32

Exit stake

Answer 32

Exit stake = Investment * (1+IRR)^T

Question 33

Ownership share

Answer 33

Ow. share = Investment * (1+IRR)^T / Exit post money

Question 34

Debt beta

Answer 34

Beta_d = (rd-rf) / (rm-rf)

Question 35

NI

Answer 35

NI = ROE * Op. equity