FINANCE 301 FORMULAS EXAM 1
QUESTIONS & VALID CORRECT
ANSWERS
balance sheet identity - Correct Answer ✔✔ assets=liabilities+SE
net working capital - Correct Answer ✔✔ Ca-cl
income statement identity - Correct Answer ✔✔ revenues-expenses=net income
cash flow identity - Correct Answer ✔✔ cffa=cftc+cfts
cash flow from assets - Correct Answer ✔✔ operating cash flow
-net capital spending
-change in working capital
operating cash flow - Correct Answer ✔✔ earnings before interest and taxes
+depreciation
-taxes
net capital spending - Correct Answer ✔✔ ending fixed assets
-beginning net fixed assets
+depreciation expense
change in working capital - Correct Answer ✔✔ end nwc-beg nwc= cash flow to creditor
cash flow to creditors - Correct Answer ✔✔ interest expense paid- net new equity raised
cash flow to stockholders - Correct Answer ✔✔ dividends paid-net new equity raised
current ratio - Correct Answer ✔✔ ca/cl
quick ratio - Correct Answer ✔✔ ca-inventory/cl
debt to equity - Correct Answer ✔✔ total debt/total equity
equity multiplier - Correct Answer ✔✔ total assets/total equity
long term debt to equity - Correct Answer ✔✔ long term debt/equity
inventory turnover ratio - Correct Answer ✔✔ cogs/inventory
QUESTIONS & VALID CORRECT
ANSWERS
balance sheet identity - Correct Answer ✔✔ assets=liabilities+SE
net working capital - Correct Answer ✔✔ Ca-cl
income statement identity - Correct Answer ✔✔ revenues-expenses=net income
cash flow identity - Correct Answer ✔✔ cffa=cftc+cfts
cash flow from assets - Correct Answer ✔✔ operating cash flow
-net capital spending
-change in working capital
operating cash flow - Correct Answer ✔✔ earnings before interest and taxes
+depreciation
-taxes
net capital spending - Correct Answer ✔✔ ending fixed assets
-beginning net fixed assets
+depreciation expense
change in working capital - Correct Answer ✔✔ end nwc-beg nwc= cash flow to creditor
cash flow to creditors - Correct Answer ✔✔ interest expense paid- net new equity raised
cash flow to stockholders - Correct Answer ✔✔ dividends paid-net new equity raised
current ratio - Correct Answer ✔✔ ca/cl
quick ratio - Correct Answer ✔✔ ca-inventory/cl
debt to equity - Correct Answer ✔✔ total debt/total equity
equity multiplier - Correct Answer ✔✔ total assets/total equity
long term debt to equity - Correct Answer ✔✔ long term debt/equity
inventory turnover ratio - Correct Answer ✔✔ cogs/inventory
