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FINANCIAL STATEMENT MODELING
ACTUAL FINAL EXAM
Which formula is used to check that a Balance Sheet has been built correctly? -
ANSWER Total Assets = Total Liabilities + Stockholders' Equity
How do you calculate Inventory Turns? - ANSWER COGS / Inventory
How do you calculate Days Sales Outstanding? - ANSWER Accounts Receivable /
Revenue * 365
We can project prepaid expenses by assuming its percentage of... - ANSWER
Revenue
How do you calculate Net Working Capital? - ANSWER Total non-cash current
assets - Total non-debt current liabilities
Depreciation is to PP&E as Amortization is to... - ANSWER Intangible Assets.
We use this driver to project Capex: - ANSWER % of revenue
When calculating the ending balance of a line item in a projected year, we
reference last year's ending balance as the beginning balance (T or F) - ANSWER
TRUE
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Beginning Intangible Balance is $10 million; Amortization = $1.5 million; Additions
= $0.75 million. What is the ending balance? - ANSWER $9.25 million
Assuming Intangible Balance is 10.0 in C11, amortization is -1.5 in C12, and
additions is 0.75 in C13, how would you quickly calculate ending Tangible Balance
in C14? - ANSWER Alt + =
In the Cash Flow Statement, we add back Depreciation and Amortization to Net
Income because... - ANSWER They are non-cash expenses
In what section of the cash flow statement does Capex belong? - ANSWER
Investing
Share repurchases decrease Stockholder's Equity (T or F) - ANSWER True
How do we project Dividends? - ANSWER Assumed Dividend Payout Ratio *
Projected Net Income
How do we link the Cash Flow Statement (CFS) to the Balance Sheet (BS)? -
ANSWER (CFS) Ending Cash = (BS) Same Year's Cash Balance
Debt issuance decreases long-term debt (T or F) - ANSWER False
What is a revolver? - ANSWER A corporation's "credit card" that is used to
finance working capital needs
FINANCIAL STATEMENT MODELING
ACTUAL FINAL EXAM
Which formula is used to check that a Balance Sheet has been built correctly? -
ANSWER Total Assets = Total Liabilities + Stockholders' Equity
How do you calculate Inventory Turns? - ANSWER COGS / Inventory
How do you calculate Days Sales Outstanding? - ANSWER Accounts Receivable /
Revenue * 365
We can project prepaid expenses by assuming its percentage of... - ANSWER
Revenue
How do you calculate Net Working Capital? - ANSWER Total non-cash current
assets - Total non-debt current liabilities
Depreciation is to PP&E as Amortization is to... - ANSWER Intangible Assets.
We use this driver to project Capex: - ANSWER % of revenue
When calculating the ending balance of a line item in a projected year, we
reference last year's ending balance as the beginning balance (T or F) - ANSWER
TRUE
, 2|Page
Beginning Intangible Balance is $10 million; Amortization = $1.5 million; Additions
= $0.75 million. What is the ending balance? - ANSWER $9.25 million
Assuming Intangible Balance is 10.0 in C11, amortization is -1.5 in C12, and
additions is 0.75 in C13, how would you quickly calculate ending Tangible Balance
in C14? - ANSWER Alt + =
In the Cash Flow Statement, we add back Depreciation and Amortization to Net
Income because... - ANSWER They are non-cash expenses
In what section of the cash flow statement does Capex belong? - ANSWER
Investing
Share repurchases decrease Stockholder's Equity (T or F) - ANSWER True
How do we project Dividends? - ANSWER Assumed Dividend Payout Ratio *
Projected Net Income
How do we link the Cash Flow Statement (CFS) to the Balance Sheet (BS)? -
ANSWER (CFS) Ending Cash = (BS) Same Year's Cash Balance
Debt issuance decreases long-term debt (T or F) - ANSWER False
What is a revolver? - ANSWER A corporation's "credit card" that is used to
finance working capital needs
