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BEC > Notes 3 > Flashcards

Notes 3 Flashcards

1
Q

Gross Profit

A

Sales

- COGS

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2
Q

COGS

A

Beginning Inventory
+Purchases
- Ending Inventory

OR

???
COG Manufactured
- Beginning Inventory
+ Ending Inventory

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3
Q

Gross Margin

A

Gross Profit /
Sales

OR

COGS * Gross Margin %

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4
Q

Gross Margin %

A

Gross Margin /

COGS

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5
Q

Ending Accounts Payable

A

Beginning Accounts Payable
+ Purchases
- Cash Disbursements
= Ending Accounts Payable

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6
Q

Net Realizable Value (NRV)

A

Units * Selling Price
= Total
- Disposal cost
= Net Realizable Value (NRV)

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7
Q

Reorder Point

A

Units of Demand during Lead-Time

+ Required Safety Stock

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8
Q

Total Applied Overhead

A

Standard Cost /
Standard Hours

OR

Application rate per hour * Actual Hours

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9
Q

Contribution Margin

A

Sales

-Variable Cost

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10
Q

Breakeven Units

aka Units to Breakeven

A

Fixed Costs /

Contribution Margin per unit

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11
Q

Units sold

A

Fixed costs + Profit /

Contribution Margin per unit

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12
Q

Before-Tax Profit

A

~ A = B + t ~

After-tax profit /
1 - tax rate

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13
Q

After-Tax Profit

A

~ A = B + t ~

Before-tax profit * (1 - tax rate)

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14
Q

Contribution Margin Ratio

A

Contribution margin per unit /

Selling Price per unit

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15
Q

Dollars to Break Even

A

Fixed Costs /

Contribution Margin % Ratio

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16
Q

Target Net Income

A

Fixed Costs + Net Income /

Contribution Margin

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17
Q

Sales Price

A

Variable Costs per unit
+Fixed Cost per unit
+Net Income desired

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18
Q

Contribution Margin Ratio

A

Price - Variable Cost /
Price

OR

Sales - Variable Cost /
Sales

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19
Q

Contribution Margin per Unit

A

Sales per unit
-Variable Cost per unit

OR

Change in Revenue /
Change in Volume

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20
Q

Margin of Safety

A

Excess Sales over Break Even

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21
Q

Profit Margin

A

Net Income after Interest & Taxes /

Net Sales

22
Q

Operating Profit Margin

A

Operating Profit /

Net Sales

23
Q

Return on Assets

aka Return on Investment

A

Net Income after Interest & Taxes /
Average Total Assets

OR

Net Profit * Asset Turnover

24
Q

Return on Equity

A

Cash Dividend per common share /

Earnings per Share

25
Q

Cost of Equity

A

(Expected Dividend /
Current Share Price)
+ Growth Rate

26
Q

Cost of Debt

A

(Interest Expense - Tax Benefit) /

Carrying Value of Debt

27
Q

Dupont ROI

A

Net Income /
Total Assets

OR

Return on Sales /
Asset Turnover

28
Q

Residual Income

A

Net Income

- (Required Rate of Return * Invested Capital)

29
Q

Economic Value Added

A

Net Profit After Taxes
- ((Total Assets - Current Liabilities) * WACC)

OR

Operating Income after Tax
- (Net Assets * WACC)

30
Q

Free Cash Flow

A

Operating Income after Tax OR Net Profit after Taxes
+ Depreciation & Amortization
- Capital Expenditures
- Change in Net Working Capital

31
Q

Financial Spread

A

Return on Income (ROI)

- Cost of Capital (CoC)

32
Q

Interest Yield

A

Interest Payment /

Bond Price

33
Q

Inventory Reorder Point

A

Average Daily Demand (aka Sales)

* Average Lead Time (aka Wait Time)

34
Q

Net Working Capital

A

Current Assets

- Current Liabilities

35
Q

Profitability Index

A

PV of Future Cash Flows /

PV of Initial Investment

36
Q

Dividend Payout Ratio

A

Cash Dividend per common share /

Earnings per Share

37
Q

Accounts Receivable Turnover

A

Net Credit Sales /

Average Accounts Receivable

38
Q

Average Collection Period

A

Average Accounts Receivable /

Average Sales per Day

39
Q

Inventory Turnover

A

Cost of Goods Sold /

Average Inventory

40
Q

Number of Days Sales in Inventory

A

Average Inventory /

COGS / 365

41
Q

Fixed Asset Turnover

A

Sales /

Average Net Fixed Assets

42
Q

Total Asset Turnover

A

Sales /

Average Total Assets

43
Q

Investment Turnover

A

Sales /

Average Investment

44
Q

Current Ratio

A

Current Assets /

Current Liabities

45
Q

Quick Ratio

A

(Current Assets - Inventory - Prepaid Expenses) /

Current Liabilities

46
Q

Debt to Total Assets

A

Total Liabilities /

Total Assets

47
Q

Debt to Equity

A

Total Liabilities /

Total Equity

48
Q

Times Interest Earned

A

Earnings before Interest & Taxes (EBIT) /

Interest Expense

49
Q

P/E Ratio

A

Stock Price per share /

Earnings per Share (EPS)

50
Q

Book Value per share

A 
Common Stock Equity /
# of common shares outstanding
51
Q

Market/Book Ratio

A

Market Value per share of common stock /

Book Value per share of common stock

BEC (12 decks)

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