Fcf analysis Study guides, Class notes & Summaries

1-1 Project Valuation is: - ANSWER-when firms acquire productive capacity by assembling necessary assets 1-1 Enterprise Valuation is: - ANSWER-when there is an acquisition of an entire business--acquiring the productive assets of an existing firm 1-1 the objective of a firm is to: - ANSWER-create wealth by initiating and managing investments that generate future CFs that are worth more than the amount invested. 1-1 what % of investments destroy value? What are the potential causes (3)? ...

Describe the 3 financial statements and discuss the connections each has to the others? - Correct answer-*Balance Sheet* The balance sheet shows a company's *assets, its liabilities and shareholders' equity*. It is a snapshot of a company at one point in time. *Income Statement* The income statement outlines the company's *revenues and expenses*. It shows their *profit/loss over* a *period of time*. *B/S and I/S Connections*: 1) Interest Expense is calculated based on debt held on B/S...

What is an LBO? In a leveraged buyout, 1) PE firm acquires a company using D + E 2) Operates it for a several years with operating improvements 3) sells it at the end of the period to realize a return on that investment Walk me through the mechanics of an LBO model. 1) Assumptions 2) S&U 3) Adjust Balance Sheet - Debt and Equity - Goodwill 4) Project 3 statements 5) Project FCF 6) Debt and Interest Schedule 7) Exit Calc (MOic and IRR) 8) Sensitivity Tables How do you as...

Corporate Finance - Answer focuses on financial decision making by a firms management Investments - Answer various types of financial instruments (stocks, bonds, etc) Banking or Financial Institutions - Answer make money by paying depositors a smaller interest rate than the interest rate charged to borrowers Treasury Securities - Answer generally bonds that are issued by the US government Corporate Bonds - Answer firms borrowing from the public Stocks - Answer a share of ownership...

WGU C214 Financial Management Fast and Furious Questions Answered 100% correct T1 Primary financial markets the markets in which securities (stocks and bonds) are first issued. This is where the issuers (the firms) and the buyers (the investors) will engage in an exchange. T1 Syndicate When a company wants to issue stock, bonds, or other publicly traded securities, it hires an underwriter to manage what is often a long and complex process. After determining the offering structure, the...

Corporate Finance - Answerfocuses on financial decision making by a firms management Investments - Answervarious types of financial instruments (stocks, bonds, etc) Banking or Financial Institutions - Answermake money by paying depositors a smaller interest rate than the interest rate charged to borrowers Treasury Securities - Answergenerally bonds that are issued by the US government Corporate Bonds - Answerfirms borrowing from the public Stocks - Answera share of ownership in a ...

Wall Street Prep questions with accurate answers, Rated A. 2022/2023 Document Content and Description Below Wall Street Prep questions with accurate answers, Rated A. 2022/2023. Do companies prefer straight-line or accelerated depreciation? - For GAAP reporting purposes, companies generally pre fer straight-line depreciation. That's because a company will record lower depreciation in the early years of the asset's life than if they had used accelerated depreciation. As a result, companies us...

WGU C214 2023 questions and correct answers Corporate Finance - correct answer focuses on financial decision making by a firms management Investments - correct answer various types of financial instruments (stocks, bonds, etc) Banking or Financial Institutions - correct answer make money by paying depositors a smaller interest rate than the interest rate charged to borrowers Treasury Securities - correct answer generally bonds that are issued by the US government Corporate Bonds -...

Common Shares - Answer- ownership interest. Residual claim (what's left after debt holders and preferred stockholders) Proxy - Answer- having someone else vote as they direct them on their behalf Statutory Voting - Answer- each share held is assigned one vote in the election of each member of the board of directors. Cumulative voting - Answer- shareholders can allocate their votes to one or more candidates as they choose. Benefits shareholders. Callable common shares - Answer- firm ...

Wallstreet Prep Valuation Test Questions and Answers 1. Could you explain the concept of present value and how it relates to company valuations?: The present value concept is based on the premise that "a dollar in the present is worth more than a dollar in the future" due to the time value of money. The reason being money currently in possession has the potential to earn interest by being invested today. For intrinsic valuation methods, the value of a company will be equal to the sum ...