test 1 overheads part 2

test 1 overheads part 2 - 3.2.Sm 6332?—.8 29533—9 E:35...

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Unformatted text preview: , 3.2: .Sm 6332:?— ..8 29533—9 E :35 8 “.8 E8 ; EEO g ES .mmmnqoioorsm ZOE—zoo 0e _ _ mam—3:32 B2007: 52 u . . , 352:: €ch 353$ - BE .3 E .8 :35 mag may: muzflzfifi u. . mash. 2:85 - " ASE maxi ESE 822mg u 3:0 NH 233:5- . w , Emma 3287: wzfiémao“ _ 3.8.5“ a. 63ro «5.5; figs: 825 mm 3:95 0 .. HEOME mmOfiO fl 28339335 - _ max—4% Sales Assets Asset Turnover = Cost of Goods Sold Inventory Turnover = Average Inventory Annual Credit Satles Accounts Receivable Turnover = ————————7—— Average Accounts Rece1vable Average Accounts Receivable Average Collection Period = I , Dally Credit Sales Sales Less Cost of Goods Sold Gross Profit Margin = Sales Net Profit M argin= W Sales Net Incom Return on Investments = c Total Investm ent . CurrentAssets Crurrent Ratio: C urrent Liabilities . _ C _ . 7 Ac1d Test Ram: W C urrent Liabilities Total Liabilities Total Assets D ebt Ratio= Net Operating Income Tim es Interest Earned: ——~—-——————-—-—— Annual Interest Expenses to ROI Ion jIn pan lectur Introduct ; ImprOVIng 1 roken uy-‘b sen qu- re f ROI r. , - BB. Equity or ROE Yo u' .maké ' “3' ‘ X .,$a:|e-s _ X. -- ~ ' Assets Profit—Margin 'x Turnover x ééguity -' ~ 7 r Wfiiplier 4. Risk-Return Relationships '— What determines how large a the ROI for a ' PartiQUIar- company should be? -' ' - Barriers to entry come from: 3% $5? é? I 0' o Uniqueness: -. 0- 00.31 Admanta gesi ng a 2. Ta : . . . _ : 7 wake d my fnat is "J i [Lil-{0"- r11ié‘s¥‘:id3z—.L t; if ‘i n f 'I?‘ 3’ ea. ' G ( 9': . : : . ' 3 a 1 - fiéffi'efiii' {110' Pierémi ‘ ' 1. $300.15 be feceived"10"-yeai5' mm nawdisccils' bagk presentat '10 pgrcent V. Campound Sum and Presén’c value—gnfiuifies -_;-_5 _§_:Defifiifion:-_ An annuity a' series of fixed payrnenE I ._ ' ‘ ' 5;;e,As$§mpfi9n152Ca$Eflcfi§ 0‘53“?- Vll. Non Afinual Compoundifig' _' We-knéw PM = PV(1 Non-annual comp ounding ten-us: APR or Annual Percentage Rate (this is also the quoted or nominal rate): The stated nominal annual rate before compounding. APY or EAR — Annual Percentage Yield or Equivalent Annual Rate: The actual annual interest rate earned or paid. ' - Taldng'a Annual Percentage rate_(APR) —— this is the nominal or quoted rate, it's generally 3 the number that’s given «— to an Annual Percentage Yield (also sometimes called an EAR or equivalent annual rate). For example, let's, take an APR of 7-85 compounded x I quarterly; 1 ' ‘ o ' Press ICONV (you’ve got to hit the 2m button then the “2" button) a - NOM = 7.85, asking for the quoted annual rate, input this rate as a % and press enter. ‘ ' I I Press the UP arrow (on the top row), and C/Y = 4 appears (or type it in if _ something else appears). This is asking for In, the number of compounding periods per year. ENTER that number. ' ‘ ' V o Press UP arrow, EFF= # appears, press CPT to find the APY. EFF = 8.08% (that number the APYJ. - ‘ ' _ ‘ r '- il‘Whichisthebet‘ter'l-Pafi": c r 7 _ 6 _ 8% compounded annually? or I 7.85% compounded quarterly? - We can’t compare these nominal (quoted) inteest rates, because they don’t include the same number of compounding periods per year. We need to calculate the APY ' r APY= [1 + (quoted ratelmflm— 1 Find the APY for the quarterly loan: APY.=[1+(.o7s.5/4)]4—1 = .OSOEor8.08% - 1. You're going to buy a house for $500,000 and you can get a 9%, 15-year mortgage with monthly payments, but the maximum monthly payment you can afford is $3,000, how much of a down payment do you need? 2. You've borroWed $200,000 to buy a house with a 15 year, 9% mortgage with monthly payments. If every month you pay an additional $500 toward your mortgage, how long will it take to payoff your mortgage? flow?“ 3. You are to receive a 10 year 300,000 annuity (that means ten cash flows of $100,000 each) with the first cash flow occurring at the end of year 5. Given a 10 percent discount rate, what is the present value of this annuity? 4. You are to receive a $100,000 perpetuity with the first payment taking place at the end of year 5. If 10 percent is the appropriate discount rate, what is the perpetuity's present value? Organizational form & Taxes Financial Markets & Instruments (Core investment alternatives) Ratios m ROI Time Value of Money Test 1 Fall 2007 Verbal 1 1 (a definition) 0 Math 12 ...
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