Chapter 18
Student: _
1. An American Depositary Receipt is defined as a security:
A. that has been deposited in an interestbearing account at a U.S. bank.
B. issued outside of the U.S. that represents shares of a U.S. stock.
C. issued in the U.S. which r
CHAPTER 8
The Valuation and Characteristics
of Stock
CHAPTER ORIENTATION
This chapter continues the introduction of concepts underlying asset valuation that began in
Chapter 7. We are specifically concerned with valuing preferred stock and common stock. W
Chapter 10 continued
Profitability Index (Benefit Cost Ratio) PI
The ratio of present value of future free cash flow (FCF) to the initial outlay
It yields same accept/reject decision as NPV
NPV gives a measure of the absolute dollar desirability of a p
CHAPTER 5
The Time Value of Money
CHAPTER ORIENTATION
In this chapter, the concept of the time value of money is introduced; that is, a dollar received
today is worth more than a dollar received a year from now. If we are to compare projects and
financial
Chapter 16 Capital flows (Portfolio Investment) : Involves financial assets with maturities greater than 1 year, sucha s purchase of foreign stocks and
bonds ; PI between countries has also been increasing and is motivated by the possibility of obtaining
CHAPTER 7
The Valuation and Characteristics
of Bonds
CHAPTER ORIENTATION
This chapter introduces the concepts that underlie asset valuation. We are specifically concerned with
bonds. We also look at the concept of the bondholder's expected rate of return
Chapter 14 Financial Forecasting: process of attempting to estimate firms future financing requirements. Three basic steps: 1) Project firms sales revenue & expenses over a planning period.
Focus on sales growth. 2) Estimate levels of investment in curren
CHAPTER 9
The Cost of Capital
CHAPTER ORIENTATION
In Chapters 7 and 8, we considered the valuation of debt and equity instruments. The concepts
advanced there serve as a foundation for determining the required rate of return for the firm and
for specific
Chapter 5compound interest interest on investment 1st period is added to the principal, during the 2nd period interest is earned on original principal + interest. PV of deferred annuity can be calculated by computing the FV and then
calculating the PV of
CHAPTER 6
The Meaning and Measurement
of Risk and Return
CHAPTER ORIENTATION
In this chapter, we examine the factors that determine rates of return (discount rates) in the
capital markets. We are particularly interested in the relationship between risk an
n
Bond market price (investors Req rate of return, ie. Yield to maturity) =
Net proceeds = market value (1 inflation cost)
interest paid year n
+
( 1+bondholder Req . Rate of return )n
Net proceeds per bond, beforetax cost of debt (NPd) =
Principal Inte
Aswath Damodaran
ESTIMATING CASH FLOWS
Cash is king
113
Steps in Cash Flow Estimation
114
Estimate the current earnings of the firm
Consider how much the firm invested to create future growth
If looking at cash flows to equity, look at earnings after inte
Nick Stuart
Dr. Ciner
1/29/17
Question 3
Q: What is the basic idea of the percentage of sales method? What does it assume about fixed
asset capacity, unless it is modified?
The percentage of sales approach is a financial planning method in which accounts
Chart Title
Row Labels
Average of Capacity Sum of Passengers
Chicago, IL
93.67%
260
Fargo, ND
58.33%
133
Green Bay, WI
85.00%
80
Houston, TX
98.00%
90
Minneapolis, MN
83.67%
215
Orlando, FL
87.33%
240
Grand Total
82.29%
1018
Chicago, IL
Houston, TX
Fargo,
Study Guide Exam 1 Fin 335
Chapter 1: Introduction to Financial Management

Be able to discuss the advantages and disadvantages of a sole proprietorship
Be able to discuss the advantages and disadvantages of partnerships
Be able to discuss the advantages
Name: _ Date: _
1.
A)
B)
C)
D)
E)
The mixture of debt and equity used by the firm to finance its operations is called:
working capital management.
financial depreciation.
agency cost analysis.
capital budgeting.
capital structure.
2.
A)
B)
C)
D)
E)
A busi
Apple Annual Report
Joey Aji, David Ridgeway, Hannah Hoxworth, Aaron Kennerly
Our presentation is based off of Apples 10k reports from 2015.
Apple is a company that competes in a wide variety of markets from
cell phones, to laptops and music devices.
Secr
ANNUAL REPORT
TEAM PROJECT
1
Annual Report Team Project
I.
General
The objective of these assignments is to relate the material being studied in ACG 201 lectures to actual financial
statements. You will gain experience obtaining a companys annual report a
Homework #5
Finance 335
1. What is the expected return for the following stock?
State Probability Retum
Average .30 X 1 1% 1' 3' 3
Good .40 x 20% .~ g
Bad .30 x 10% : _ 3
A
rug370
2. What is the variance and standard deviation of the following returns?
St
Chapter 11
The Basics of Capital Budgeting
Net Present Value
The Payback Rule
The Internal Rate of Return
The Profitability Index
Net Present Value
Assume you have the following information on Project X:
Initial outlay $1,100
Required return = 10%
Annual
Practice Problems for Exam 2
Chp 8: Stock Valuation
18) Synovec Co. is growing quickly. Dividends are expected to grow at a rate of 30 percent for the next
three years, with the growth rate falling off to a constant 4 percent thereafter. If the required r