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BEC Pass Notes > Formulas > Flashcards

Formulas Flashcards

1
Q

MOH Formula

A

FC+VC/ Driver

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2
Q

%Change

A

current-prior/prior

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3
Q

market interest rate

A

risk free rate + inflation premium

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4
Q

inflation factor

A

current CPI/ Previous CPI

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5
Q

Worth after inflation

A

Real value/ 1 + inflation

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6
Q

Price Elasticity

A

Change in quantity demand/ change in price demanded

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7
Q

GDP multiplier

A

1/MPS or reserve ratio

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8
Q

Forward premium or discount

A

(forward rate-spot rate/ spot rate) * total/amount in forward

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9
Q

Expected Return

Variance

A

good probability * % + bad probability * %

good probability * (%- expected return)2 + bad probability * (% - expected return)2

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10
Q

ARR

A

annual NI/ average (initial investment)

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11
Q

NPV

A

PVFCF - investment

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12
Q

NPV =, greater than, less than 0 IRR effect

A

direct relationship

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13
Q

Inventory Conversion Period

A

AVG inventory/ (COGS/365)

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14
Q

Average Receivables

A

AVG receivables/ (credit sales/365)

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15
Q

Payables deferral period

A

AVG payables/ (COGS/365)

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16
Q

Conversion cycle

A

inventory + receivables - payable

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17
Q

EOQ

A

(2* cost of placing an order(SETUP COSTS)(ONLY VARIABLE COST) * demand/cost of carrying) square rooted

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18
Q

days sales outstanding

A

receivables/sales per day

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19
Q

nominal annual cost

A

(discount/100 - discount)x 365/ total days - discount days

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20
Q

effective interest rate

A

interest paid/ principle available (principle - DISCOUNTED interest ONLY - compensating balance)

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21
Q

DOL

A

% change in operating income/ % change in unit volume(SALES)

contribution margin/ CM- fixed costs

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22
Q

DFL

A

% change in EPS/ % change in EBIT

change in NI/change in operating income

DEBT/EQUITY

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23
Q

CAPM

A

risk free + (mkt - risk free) *beta coefficient

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24
Q

Cost of CS/ Alternate CAPM

A

(expected dividend/ current price(1- float cost) + growth rate in earnings

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25
Q

cost of bond issue

A

interest rate * (1 - effective rate)

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26
Q

cost of preferred stock

A

Total dividend amt/ issue price

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27
Q

ROI (3)

A

NI/ TA

NI/Sales *Sales/AVG investment
Return on Sales * Capital/Asset Turnover

ROS(profit margin) * Asset Turnover ratio

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28
Q

RI

A

NI - Interest on Investment

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29
Q

EVA

A

NOPAT - (total asset- current liabilities) WACC

NOPAT - cost of capital

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30
Q

Free flow cash

A

NOPAT
+ Dep
- cap expenditure
- change in WC requirements

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31
Q

Profit Margin

A

NI after interest and taxes/ net sales

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32
Q

Operating Profit Margin

A

Operating Profit/ Net sales

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33
Q

Return on Equity

A

NI after interest and taxes/ avg CS equity

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34
Q

Dividend Payout Ratio

A

Cash Dividend per CS/ Earnings per CS

35
Q

Receivables turnover

A

Net credit sales/ AVG A/R

36
Q

Average Collection Period

A

AVG AR/ Avg sales per day

37
Q

Inventory turnover

A

COGS/ AVG inventory

38
Q

Fixed Asset Turnover

A

Sales/ AVG FA

39
Q

total asset turnover

A

sales/ avg total asset

40
Q

Quick Ratio excludes

A

INVENTORY

41
Q

Times interest earned

A

earning BEFORE interest and taxes/ interest expense

42
Q

Price/earnings ratio

A

stock price per share/ earnings per share

43
Q

BV per share

A

CS equity/ # of shares outstanding

44
Q

Breakeven with a profit

A

sales- vc-fc

45
Q

Units to breakeven

A

FC/CM

46
Q

Dollars to breakeven

A

FC/CM RATIO

47
Q

Target NI

A

SPX = VCX + FC + (target % *SPX)

48
Q

Real GDP

A

nominal rate/price index

49
Q

Net Domestic Production

A

GDP - depreciation

50
Q

National Income

A

NDP - indirect business taxes - net foreign factor income

51
Q

PI

A

NI - corp taxes - undistributed profits - SS contributions + transfer payments

52
Q

DI

A

PI - personal taxes

53
Q

Marginal Propensity to Consume

A

change in level of consumption/ change in disposable incme

54
Q

Reserve Ratio

A

Reserves/ Total demand deposits

55
Q

Income Approach

A

Wages + Rental Income + Dividends

56
Q

Expenditure Approach

A

Personal Consumption + investments (net imports - exports) + gov acquisitions

57
Q

Lowest Cost Formula

A

of units * carrying costs/ stock outs costs * probability of running out * PO

58
Q

OH Rate

A

Estimated OH/ Estimated DL

59
Q

APPLIED OH

A

OH * Actual DL

60
Q

Gross Margin

A

Sales - COGS

61
Q

Weighted Avg

A

Completed + Spoiled Goods + Completed EWIP

62
Q

Excess of PV index

A

PV of FCF - tax - depreciation / Initial * 100

excess id greater than 100 then return exceeds required

63
Q

ARR

A

NI/ investment (no time value)

64
Q

payback

A

initial investment/ annual CF

65
Q

Inflation Rate

A

Risk free - nominal rate

66
Q

Return on CS

A

dividends % * sale price/ beg. price - flotation costs

67
Q

NPV for items with additional investment

A

PV of FCF * Annuity
PV of additional investment
- initial investment
- additional investment

68
Q

operating profit margin

A

sales - COGS - NI / Total sales

69
Q

Predetermined OH

A

estimated VOH/ Estimated Activity Level

70
Q

Profit Center Income

A

Controllable Rev

Controllable Costs

71
Q

Company’s Preferred Cost

A

(PAR * % issued/FMV - issuance costs

72
Q

Planned Debt Financing

A

Actual Interest/Actual Cost incurred

73
Q

Usage

A

Purchases + BI - EI

74
Q

Production/Purchases

A

COGS + EI - BI

75
Q

Contribution Margin

A

Change in Rev/ Change in Volume

76
Q

Special Orders

A

Opportunity Costs + DM + DL + VOH

77
Q

Real GDP

A

nominal GDP/price index

78
Q

Economic Rate Return

A

(Dividends + Change in price) ÷ Beginning price

79
Q

Reserve Ratio

A

Reserve/Total demand deposits

80
Q

Average inventory with EOQ model

A

EOQ/2 + safety stock

81
Q

Safety Maximum Average Daily
stock / Reorder point

Reorder Purchase point

A

= (lead time - lead time) x usage

= lead time units + safety stock

82
Q

Collection Ratio

A

= A/R/Average Daily Sales

83
Q

debt ratio

A

total debt/total assets

84
Q

Return on Equity

A

Sales/Equity

BEC Pass Notes (7 decks)

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