Midterm note

Question 1

trách nhiệm corporation

Answer 1

limited liability

Question 2

decision of financing

Answer 2

stock, bond

Question 3

CA

Answer 3

turn into cash in 12 months

level of liquidity giảm: cash -> AR -> inventory

Question 4

CA - CL =

Answer 4

NWC

Question 5

EBIT =

Answer 5

Revenue(Sales) - Cost - Selling expense - Depreciation expense

EBIT - Interest = EBT

Question 6

NI (net income) =

Answer 6

EBT - Tax

Question 7

OCF =

Answer 7

EBIT + Depreciation - Tax

Question 8

Comparison of decision of investment and financing

Answer 8

investment: fixed assets
financing: bond, stock

Question 9

Leverage Ratio

Answer 9

“Debt/Equity Ratio = value long term debt / value long term equity”
Debt/Equity = TD / TE = (TA - TE) / TE

Total debt ratio = (TA-TE)/TA
Equity multiplier=TA/TE=1+D/E

Question 10

Times Interest Earned =

Answer 10

EBIT / Interest (đv là times)

Question 11

Days’ Sales in inventory

or Days in inventory =

Answer 11

365 / Inventory turnover = 365 / (COGS/inventory) (đv là days)

Inventory turnover = Cost of Goods Sold / Inventory (đv là times)

Decrease days in inventory

Question 12

Net Profit Margin ( đề cho EBIT, revenue, total assets)

Answer 12

Net income / Sales

(Revenue-Cost)/Revenue

Question 13

Return on Assets (ROA)

Answer 13

Net income / Total assets

Question 14

Return on Equity (ROE)

Answer 14

Net income / Total equity

Question 15

Market Capitilization

Answer 15

Number of outstanding stocks x market value or price per share

vd: $88 per share x 33 million shares = $2,904 mill.

Question 16

Future Value

Answer 16

one period case:
Present Value x (1 + r)
-> PV=FV(1+r)

Multiperiod case:
FV = PV x (1+r)^t

Question 17

Annuity

Answer 17

Equal payment, equal interval for the “limited time”

equal cash flows occurring each time period over a fixed length of time

Question 18

Perpetuity

Answer 18

Equal payment, equal interval “forever”

Question 19

NPV =

Answer 19

• Cost + PV
  (present value of the future cash flows minus the initial cost)

Outflow (năm đầu, initial investment)
Chỉ chấp nhận khi NPV>0
((Chấp nhận dự án khi rate of return>0 (SAI))

Question 20

Có chữ “except”

Answer 20

chọn câu sai

Question 21

Make investment decisions

Answer 21

based on CF “after taxes”

Question 22

NWC

Answer 22

firm or company must invest cash in short term assets to produce finished goods

Question 23

Opportunity cost

Answer 23

mất đi do chọn làm việc khác

Question 24

Sunk cost

Answer 24

money already spent

Question 25

NPV (tử và mẫu phải consistent)

Answer 25

tử (nominal, gồm lạm phát)/(real, ko lạm phát) thì mẫu cũng phải (nominal)/(real)

Question 26

Fisher Inflation

Answer 26

(1+nominal) = (1+real) (1+inflation)

Question 27

Fisher Inflation

Answer 27

(1+nominal) = (1+real)x(1+inflation)

1+R)=(1+r)(1+h

Question 28

Book Value of equipment (at the end of…years) =

Answer 28

GT mua ban đầu - Accumulated depreciation = 1,000-100=900

Depr 1st: $50
Depr 2st: $50
-> Accumulated depreciation =50+50=100

Question 29

Tax shield on depreciation

Answer 29

depreciation x tax rate = 100,000x35%=35,000

Question 30

Bond valuation (Face value/Par value, Price of bond, coupon rate, N, YTM)

Answer 30

PMT = Face value x coupon rate (Price of bond, ytm, n?)

Question 31

Stock valuation (focus on constant growth)

Answer 31

P0 = D1/(R-g)

Trong bài thường cho D0 (just paid) -> D1 = D0x(1+g
expected, will -> D1)

Question 32

Value of common stock depend on

Answer 32

Future dividend, discount rate

Question 33

Stock valuation (focus on constant growth)

Answer 33

P0 = D1/(R-g)

Trong bài thường cho D0 (just paid) -> D1 = D0x(1+g)
(expected, will -> D1)

Đk: g tăng ổn định, forever; R>g (mẫu dương, khác 0)

Question 34

R =

Answer 34

(D1/P0)+g

D1/P0: divided yield
g: rate of growth in dividend or capital gains yield

Question 35

Average tax rate =

Answer 35

Tổng taxes/revenue

(lũy tiến) 0-50: 15%, 50-75: 25%… -> tính từng khoảng -> cộng lại -> chia thu nhập

Question 36

DuPont

Answer 36

equity multiplier thể hiện cho financial laverage
profit margin -> operating efficiency
total asset turnover -> asset used efficiency

Question 37

ROA = ROE

Answer 37

=> company không vay mượn nợ

Question 38

Khấu hao MACRS

Answer 38

1: 20%
2: 30%
3: 19.2%

depreciation expense năm 1: $100,000x20%=20,000
depreciation expense năm 3: $100,000x19.2%=19,200

Question 39

initial cash flow của project (5-6 dòng khá dài)

Answer 39

5 năm trước 1 tỷ
bây h 2 tỷ -> tập trung vào 2 tỷ bây h (market value)
cộng tiền cải tạo vào gt miếng đất

Question 40

Total return =

Answer 40

Dividend yield + Capital gain yield

Question 41

NPV (ghi ra từng năm)

Answer 41

thường CF từ năm 1 -> 4 giống nhau

xem năm 5 có salvage value ko

• > có thì cộng vô
• > có capital gain ko

Bài dường như có salvage value => CF từ năm 1->4 giống nhau

Question 42

External financing needed

Answer 42

Pro forma balance sheet, sale tăng bn %, nợ và chi phí cũng tăng nhiêu đó

EFN tăng bao nhiêu