12 midterm exam formula sheet balance sheet income

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12 Midterm Exam Formula Sheet Balance-sheet & income statement T/A = T/L + T/E, NWC = C/A – C/L, NI = R/E + DIV CFFA = CF DH + CF SH + Cash = OCF – NWC (non cash) – CAPEX OCF = NI + DEP + INT NWC (N/C) = End N/C NWC – Beg N/C NWC CAPEX = End NFA – Beg NFA + DEP CF DH = INT – Net New Debt CF SH = DIV – Net New Equity Time Value of Money FV = ( ) t r 1 Investment + × PV = ( ) t r + 1 Value Future PV of a perpetuity = r C PV of a growing perpetuity = g r C 1 - PV of an annuity = + - × t ) r 1 ( r 1 r 1 C = + - × - r ) r 1 ( 1 C t (easier to calculate) FV of an annuity = - + × r 1 ) r 1 ( C t PV of a growing annuity = + + - × - t 1 r 1 g 1 1 g r C Annuity factor = + - t ) r 1 ( r 1 r 1 = + - - r ) r 1 ( 1 t PV of an annuity due = (1+r) x (PV of an annuity) FV of an annuity due = (1+r) x (FV of an annuity) 1 + Real rate = rate Inflation 1 rate Nominal 1 + + APR = Period Rate * m EAR = ( ) 1 Rate Period 1 m - + Period Rate = 1 ) EAR 1 ( m 1 - + Bonds and Stocks Price of a bond = PV (Coupons) + PV (Face Value) = t t ) r 1 ( Value Face ) r 1 ( r 1 r 1 C + + + - ×
13 Current yield = price Bond payment coupon Annual Rate of return = price Initial loss or gain Capital Income + Dividend yield = price Stock payment Dividend Sustainable growth rate: g = ROE x Plowback ratio Dividend Discount Model: H H H H 2 2 1 0 ) r 1 ( P ) r 1 ( DIV ... ) r 1 ( DIV r 1 DIV P + + + + + + + + = where H is the horizon date, and P H is the expected price of the stock at date H No-Growth Dividend Discount Model: r DIV P 1 0 = Constant-Growth Dividend Discount Model: , DIV 1 0 g r P - = Expected Rate of Return Formula: 0 0 1 0 1 0 1 P P P P DIV g P DIV r - + = + =
14 DuPont Identity: ROE = Net Profit Margin X Total Asset Turnover X Equity Multiplier where Equity Multiplier = (1 + D/E)
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