Exam 18: Financial Modelling and Pro Forma Analysis

Use the tables for the question(s)below. Pro Forma Income Statement for Ideko,2010-2015 Pro Forma Balance Sheet for Ideko,2010-2015 -Assuming that Ideko has a EBITDA multiple of 9.4,then the continuation unlevered price-earnings ratio of Ideko in 2015 is closest to:

(Multiple Choice)

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Question 101

What is the plug?

(Essay)

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Question 102

The market size for Loppins is 40 million units.If SPI Inc.has a market share of 40% and the average sales price is $3 per Loppin,what is the dollar amount of sales of SPI?

(Multiple Choice)

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Question 103

What is the implied assumption in percent of sales method?

(Essay)

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Question 104

A firm has interest expense of $6500 each year for ten years.If the tax rate is 35% and the discount rate is 6%,compute the value of the interest rate tax shield.

(Multiple Choice)

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Question 105

What is the free cash flow to equity holders for a firm with free cash flow of $11,000,after-tax interest expense of $2000,and an increase in debt of $2000?

(Multiple Choice)

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Question 106

How do we compute net new financing?

(Essay)

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Question 107

Use the tables for the question(s)below. Pro Forma Income Statement for Ideko,2010-2015 Pro Forma Balance Sheet for Ideko,2010-2015 -Assuming that Ideko has a EBITDA multiple of 8.5,then the continuation levered price-earnings ratio of Ideko in 2015 is closest to:

(Multiple Choice)

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Question 108

A firm has interest expense of $3500 each year for ten years.If the tax rate is 35% and the discount rate is 8%,compute the value of the interest rate tax shield.

(Multiple Choice)

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Question 109

Use the table for the question(s)below. Ideko Sales and Operating Cost Assumptions -Based upon Ideko's sales and operating cost assumptions,what production capacity will Ideko require in 2016?

(Multiple Choice)

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Question 110

Kendo Corp.is projecting sales of $15 million in the coming year.If the size of the market is $50 million,and Kendo's projected market share is 25%,what is the average sale price of its products?

(Multiple Choice)

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Question 111

What is the major shortcoming of the percent of sales method for firms experiencing rapid growth?

(Essay)

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Question 112

For valuing a planned expansion,in addition to forecasting cash flows we need to estimate the firm's continuation value.

(True/False)

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Question 113

Given the following data for a given period,compute the free cash flow to the firm: Net Income = $12,000 After-tax Interest Expense = $2000 Depreciation = $1000 Increase in NWC = $2000 Capital Expenditures = $1000

(Multiple Choice)

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Question 114

A services firm does all its business in cash only.The firm projects a cash balance of of $2000 in its account after all taxes and costs are paid.The owners plan to invest $5000 and pay a dividend of $1000.How much net new financing is needed?

(Multiple Choice)

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Question 115

Use the table for the question(s)below. Ideko Sales and Operating Cost Assumptions -Based upon Ideko's sales and operating cost assumptions,what production capacity will Ideko require in 2018?

(Multiple Choice)

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Question 116

A firm has $50 million in equity and $20 million in debt,has net income of $10 million and an internal growth rate of 6%.What is the firm's payout ratio?

(Multiple Choice)

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Question 117

XYZ has no excess cash and a corporate tax rate of 30%.The firm plans to issue new debt of $2 million this year.What is the free cash flow to equity?

(Multiple Choice)

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Question 118

Use the tables for the question(s)below. Pro Forma Income Statement for Ideko,2010-2015 Pro Forma Balance Sheet for Ideko,2010-2015 -Assuming that Ideko has a EBITDA multiple of 9.4,then the continuation enterprise value of Ideko in 2015 is closest to:

(Multiple Choice)

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Question 119

The sustainable growth rate assumes that the firm will raise no new debt financing.

(True/False)

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Question 120

Showing 101 - 120 of 124

Exam 18: Financial Modelling and Pro Forma Analysis

Use the tables for the question(s)below. Pro Forma Income Statement for Ideko,2010-2015 Pro Forma Balance Sheet for Ideko,2010-2015 -Assuming that Ideko has a EBITDA multiple of 9.4,then the continuation unlevered price-earnings ratio of Ideko in 2015 is closest to:

What is the plug?

The market size for Loppins is 40 million units.If SPI Inc.has a market share of 40% and the average sales price is $3 per Loppin,what is the dollar amount of sales of SPI?

What is the implied assumption in percent of sales method?

A firm has interest expense of $6500 each year for ten years.If the tax rate is 35% and the discount rate is 6%,compute the value of the interest rate tax shield.

What is the free cash flow to equity holders for a firm with free cash flow of $11,000,after-tax interest expense of $2000,and an increase in debt of $2000?

How do we compute net new financing?

Use the tables for the question(s)below. Pro Forma Income Statement for Ideko,2010-2015 Pro Forma Balance Sheet for Ideko,2010-2015 -Assuming that Ideko has a EBITDA multiple of 8.5,then the continuation levered price-earnings ratio of Ideko in 2015 is closest to:

A firm has interest expense of $3500 each year for ten years.If the tax rate is 35% and the discount rate is 8%,compute the value of the interest rate tax shield.

Use the table for the question(s)below. Ideko Sales and Operating Cost Assumptions -Based upon Ideko's sales and operating cost assumptions,what production capacity will Ideko require in 2016?

Kendo Corp.is projecting sales of $15 million in the coming year.If the size of the market is $50 million,and Kendo's projected market share is 25%,what is the average sale price of its products?

What is the major shortcoming of the percent of sales method for firms experiencing rapid growth?

For valuing a planned expansion,in addition to forecasting cash flows we need to estimate the firm's continuation value.

Given the following data for a given period,compute the free cash flow to the firm: Net Income = $12,000 After-tax Interest Expense = $2000 Depreciation = $1000 Increase in NWC = $2000 Capital Expenditures = $1000

A services firm does all its business in cash only.The firm projects a cash balance of of $2000 in its account after all taxes and costs are paid.The owners plan to invest $5000 and pay a dividend of $1000.How much net new financing is needed?

Use the table for the question(s)below. Ideko Sales and Operating Cost Assumptions -Based upon Ideko's sales and operating cost assumptions,what production capacity will Ideko require in 2018?

A firm has $50 million in equity and $20 million in debt,has net income of $10 million and an internal growth rate of 6%.What is the firm's payout ratio?

XYZ has no excess cash and a corporate tax rate of 30%.The firm plans to issue new debt of $2 million this year.What is the free cash flow to equity?

Use the tables for the question(s)below. Pro Forma Income Statement for Ideko,2010-2015 Pro Forma Balance Sheet for Ideko,2010-2015 -Assuming that Ideko has a EBITDA multiple of 9.4,then the continuation enterprise value of Ideko in 2015 is closest to:

The sustainable growth rate assumes that the firm will raise no new debt financing.

Corporate Finance and the Financial Manager

Introduction to Financial Statement Analysis

The Valuation Principle: the Foundation of Financial Decision Making

The Time Value of Money

Interest Rates

Bonds

Valuing Stocks

Investment Decision Rules

Fundamentals of Capital Budgeting

Risk and Return in Capital Markets

Systematic Risk and the Equity Risk Premium

Determining the Cost of Capital

Risk and the Pricing of Options

Raising Equity Capital

Debt Financing

Capital Structure

Payout Policy

Working Capital Management

Short-Term Financial Planning

Risk Management

International Corporate Finance

Leasing

Mergers and Acquisitions

Corporate Governance

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