Exam 1 Study Guide

Exam 1 Study Guide - Chapter 1: 1. Agency Problem is a...

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Chapter 1: 1. Agency Problem is a conflict of interest that can arise between managers and owners. Chapter 2: 1. Basic structure of a balance sheet is Assets = Liabilities + Equity 2. Basic structure of an income statement is Revenues – Expenses = Income. 3. Basic equations, such as TA=TL + TL. TA=CA+NFA 4. Net Working Capital is the difference between a firm’s current assets and its current liabilities, ( Working capital = Current assets – Current liabilities). 5. Market value is the price at which the assets, liabilities, or equity can be bought or sold. 6. Book value is the original purchase price of the asset. 7. Net income is the remaining income after subtracting expenses and losses. 8. Depreciation is the reduction in value of an item. 9. EBIT is earnings before interest and taxes. 10. EBITDA is earnings before interest, taxes, depreciation, and amortization. 11. Marginal tax is the rate of extra tax you would pay if you earned one more dollar. Average tax is your tax bill divided by your taxable income.? Calculation.
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This note was uploaded on 06/16/2010 for the course FIN 335 taught by Professor Peter during the Spring '09 term at A.T. Still University.

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Exam 1 Study Guide - Chapter 1: 1. Agency Problem is a...

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