Essay About Pic And Book Value

Mgmt405 Microeconomics Study Sheet
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[pic 1][pic 2][pic 3][pic 4][pic 5][pic 6][pic 7][pic 8][pic 9][pic 10][pic 11][pic 12][pic 13]Also, Allowance for Inv breakage/shrinkage (contra asset), Warranty Liability, Returns Liability/Allowance[pic 14][pic 15]LIFO: Higher COGS, Lower ending Inv     [pic 16]Cost of goods available [Beg Inventory+Purchases] = COGS + Ending Inventory [goods not sold][pic 17][pic 18][pic 19][pic 20]Land/Const-in-progress do not depreciateRecoverability test 🡪 Undiscounted future cash flows (until useful life) ≥ book value  (IFRS uses fair value ≥ Book value)Improvements increase book value (CFI), maintenance is an expense (CFO)Goodwill = Acquired Liabilities – Acquired ID’able assets + acquisition price[pic 21]Premium Bond: Proceeds > FV,  Coupon > Eff Rate,  Coupon > Interest Expense,  Coupon payment reduces NBV of B/PDiscount Bond: Proceeds < FV,  Coupon < Eff Rate,  Coupon < Interest Expense,  NBV of B/P increases after paying coup.[pic 22]NBV B/P = PV of future payments, discounted  🡪  [pic 23]        Interest paid = coupon payment[pic 24]Gain/Loss = Proceeds – NBV [pic 25][pic 26][pic 27][pic 28]  Shares Auth’d = Shares issued + not issued;  Shares outstanding (held by shareholders) = Shares issued – Treasury Stock[pic 29]Gain or loss on share reissuance not recognized on I/S [pic 30][pic 31][pic 32][pic 33]                                                                    (Earnings Yield)[pic 34]   (Dupont Analysis)      Market-to-book Ratio [pic 35][pic 36]Common-size I/S 🡪 Divide all by net revenueCommon-size B/S 🡪 Divide all by total assetsValuation multiples 🡪 Market cap/Revenue [pic 37][pic 38][pic 39][pic 40][pic 41][pic 42][pic 43][pic 44]Revenue recognition – Revenue must be earned/delivered/rendered and must be realized/realizable/converted to cashCFO: Interest and dividend inflow, Interest payment outflow, income taxes outflowCFI: Dividend outlflowWays to increase earnings – hold qtr open, recognize expenses or not, classification shiftingWhy? – getting ready for IPO, smoothing growthReturns reduce revenue, Warranty Liab 🡪 COGS, AFDA reduces A/RAFDA Beg – Writeoffs + Bad Debt Expense = AFDA Ending