Free Cash Flow to Equity

Question 1

FCFE

Answer 1

Cash flow from operations - fixed capital investment + net borrowing

Question 2

Common-size income statement ratios

Answer 2

Income statement account / sales

Question 3

common-size balance sheet ratios

Answer 3

Balance sheet account / total assets

Question 4

Common-size cash flow ratios

Answer 4

Cash flow statement account / revenues

Question 5

Original DuPont equations

Answer 5

ROE = (net profit margin)(asset turnover ratio)(leverage ratio)

Question 6

Extended DuPont equation

Answer 6

ROE=(net income/EBT)(EBT/EBIT)(EBIT/revenue)(revenue/total assets)(total assets/total equity)

Question 7

basic EPS

Answer 7

net income - preferred dividends / weighted average number of common shares outstanding

Question 8

Diluted EPS

Answer 8

[NI - preferred dividends]+[convertible preferred dividends]+convertible debt interest/[Weighted average shares]+[Shares from conversion of convertible preferred shares]+[shares from conversion of convertible stock]+[shares issuable from stock options]