The analytical income statement and balance sheet

Question 1

What are the primary reasons for separating operating, investing and financing activities?

a) Investing is their primary source to value creation
b) Financing is what makes the company unique
c) Operation is their primary source to value creation
c) Investing is what makes a company unique
d) All answers are correct
e) Operation is what makes the company unique

Answer 1

c +e)

Question 2

How is the effective corporate tax calculated?

Answer 2

t=(Corporation tax)/EBT

Question 3

Derivate NOPAT from EBIT

Answer 3

NOPAT=EBIT-(EBIT*t),

,where

t=(Corporation tax)/EBT

Question 4

Invested capital is also referred to as

a) Net operating liabilities
b) Operating assets
c) Net operating assets
d) Operating liabilities
d) None of the above

Answer 4

c)

Question 5

The following are examples of

• Intangible and tangible assets
• Inventories
• Accounts receivable
• Trade receivable
• Goodwill
• Product rights
• Development projects

a) FInancing activities
b) Operating activities
c) Investing activities
d) A mix

Answer 5

b)

Question 6

The following are examples of

• Loans and borrowings (non-current)
• Long-term debt
• Share capital
• Retained earnings
• Pension obligations
• Mortgage debt

a) FInancing activities
b) Operating activities
c) Investing activities
d) A mix

Answer 6

a)

Question 7

How is the tax benefits calculated?

Answer 7

Tax benefits (shield)=Net financial expenses*Effective tax rate