TRANSACTION COMPS MODELLING WALL STREET PREP TRANSACTION COMPS MODELLING WALL STREET PREP
EXAM NEWEST ACTUAL EXAM ALL 50 QUESTIONS EXAM NEWEST ACTUAL EXAM ALL 50 QUESTIONS
AND CORRECT DETAILED ANSWERS WITH RATIONALES AND CORRECT DETAILED ANSWERS WITH RATIONALES
|ALREADY GRADED A+ |ALREADY GRADED A+
What are the inventory days for the company? - ANSWER--65.7 days
If a company has projected revenues of $10 billion, a gross profit margin Which of the following is true - ANSWER--Coca Cola's brand name is
of 65%, and projected SG&A expenses of $2billion, what is the not reflected as an intangible asset on its balance sheet
company's operating (EBIT) margin? - ANSWER--45%
A company has the following information:
A company has the following information, 1. 2014 revenues of $5 • 2014 share repurchase plan of $4 billion
billion,2013 Accounts receivable of $400 million, 2014 accounts
receivable of $600 million, what are the days sales outstanding - • Average share price of $60 for the year 2013
ANSWER--36.5 • Expected EPS growth for 2014 of 10%
What should the number of shares repurchased by the company be in
A company has the following information: your financial model? - ANSWER--60.6 million
• 2014 Revenues of $8 billion
non-controlling interest - ANSWER--is an expense on the income
• 2014 COGS of $5 billion
statement and equity o the balance sheet
• 2013 Accounts receivable of $400 million
• 2014 Accounts receivable of $600 million A company has the following information:
• 2013 Inventories of $1 billion • 2013 retained earnings balance of $12 billion
• 2014 Inventories of $800 million • Net income of $3.5 billion in 2014
• 2013 Accounts payable of $250 million • Capex of $200 million in 2014
• 2014 Accounts payable of $300 million • Preferred dividends of $100 million in 2014
• Common dividends of $400 million in 2014
, TRANSACTION COMPS MODELLING WALL STREET PREP TRANSACTION COMPS MODELLING WALL STREET PREP
EXAM NEWEST ACTUAL EXAM ALL 50 QUESTIONS EXAM NEWEST ACTUAL EXAM ALL 50 QUESTIONS
AND CORRECT DETAILED ANSWERS WITH RATIONALES AND CORRECT DETAILED ANSWERS WITH RATIONALES
|ALREADY GRADED A+ |ALREADY GRADED A+
What is the retained earnings balance at the end of 2014? - ANSWER- million. After building an earnings model for Company X, you have
15 billion projected free cash flow for each year through 2020 as follows:
in order to find out how much cash is available to pay down short term Year 2014 2015 2016 2017 2018 2019 2020
debt, such as revolving credit line, you must take - ANSWER-beginning Free Cash Flow 110 120 150 170 200 250 280
cash balance + pre-debt cash flows - min. cash balance - required
principal payments of LT and other debt
You estimate that the weighted average cost of capital (WACC) for
Company X is 10% and assume that free cash flows grow in perpetuity
to calculate interest expense in the future, you should do which of the at 3.0% annually beyond 2020, the final projected year. Estimate the
following - ANSWER--apply a weighted average interest rate times the present value of the projected free cash flows through 2020, discounted
average debt balance over the course of the year at the stated WACC. Assume all cash flows are generated at the end of
the year (i.e., no mid-year adjustment): - ANSWER--837 million
enterprise (transaction) value represents the: - ANSWER--value of all
capital invested in a business On January 1, 2014, shares of Company X trade at $6.50 per share, with
400 million shares outstanding. The company has net debt of $300
A debt holder would be primarily concerned with which of the following million. After building an earnings model for Company X, you have
multiples? projected free cash flow for each year through 2014 as follows:
I. Enterprise (Transaction) Value / EBITDA
II. Price/Earnings Year 2014 2015 2016 2017 2018 2019 2020
III. Enterprise (Transaction) Value / Sales - ANSWER--1 and 3 only Free Cash Flow 110 120 150 170 200 250 280
On January 1, 2014, shares of Company X trade at $6.50 per share, with
400 million shares outstanding. The company has net debt of $300
EXAM NEWEST ACTUAL EXAM ALL 50 QUESTIONS EXAM NEWEST ACTUAL EXAM ALL 50 QUESTIONS
AND CORRECT DETAILED ANSWERS WITH RATIONALES AND CORRECT DETAILED ANSWERS WITH RATIONALES
|ALREADY GRADED A+ |ALREADY GRADED A+
What are the inventory days for the company? - ANSWER--65.7 days
If a company has projected revenues of $10 billion, a gross profit margin Which of the following is true - ANSWER--Coca Cola's brand name is
of 65%, and projected SG&A expenses of $2billion, what is the not reflected as an intangible asset on its balance sheet
company's operating (EBIT) margin? - ANSWER--45%
A company has the following information:
A company has the following information, 1. 2014 revenues of $5 • 2014 share repurchase plan of $4 billion
billion,2013 Accounts receivable of $400 million, 2014 accounts
receivable of $600 million, what are the days sales outstanding - • Average share price of $60 for the year 2013
ANSWER--36.5 • Expected EPS growth for 2014 of 10%
What should the number of shares repurchased by the company be in
A company has the following information: your financial model? - ANSWER--60.6 million
• 2014 Revenues of $8 billion
non-controlling interest - ANSWER--is an expense on the income
• 2014 COGS of $5 billion
statement and equity o the balance sheet
• 2013 Accounts receivable of $400 million
• 2014 Accounts receivable of $600 million A company has the following information:
• 2013 Inventories of $1 billion • 2013 retained earnings balance of $12 billion
• 2014 Inventories of $800 million • Net income of $3.5 billion in 2014
• 2013 Accounts payable of $250 million • Capex of $200 million in 2014
• 2014 Accounts payable of $300 million • Preferred dividends of $100 million in 2014
• Common dividends of $400 million in 2014
, TRANSACTION COMPS MODELLING WALL STREET PREP TRANSACTION COMPS MODELLING WALL STREET PREP
EXAM NEWEST ACTUAL EXAM ALL 50 QUESTIONS EXAM NEWEST ACTUAL EXAM ALL 50 QUESTIONS
AND CORRECT DETAILED ANSWERS WITH RATIONALES AND CORRECT DETAILED ANSWERS WITH RATIONALES
|ALREADY GRADED A+ |ALREADY GRADED A+
What is the retained earnings balance at the end of 2014? - ANSWER- million. After building an earnings model for Company X, you have
15 billion projected free cash flow for each year through 2020 as follows:
in order to find out how much cash is available to pay down short term Year 2014 2015 2016 2017 2018 2019 2020
debt, such as revolving credit line, you must take - ANSWER-beginning Free Cash Flow 110 120 150 170 200 250 280
cash balance + pre-debt cash flows - min. cash balance - required
principal payments of LT and other debt
You estimate that the weighted average cost of capital (WACC) for
Company X is 10% and assume that free cash flows grow in perpetuity
to calculate interest expense in the future, you should do which of the at 3.0% annually beyond 2020, the final projected year. Estimate the
following - ANSWER--apply a weighted average interest rate times the present value of the projected free cash flows through 2020, discounted
average debt balance over the course of the year at the stated WACC. Assume all cash flows are generated at the end of
the year (i.e., no mid-year adjustment): - ANSWER--837 million
enterprise (transaction) value represents the: - ANSWER--value of all
capital invested in a business On January 1, 2014, shares of Company X trade at $6.50 per share, with
400 million shares outstanding. The company has net debt of $300
A debt holder would be primarily concerned with which of the following million. After building an earnings model for Company X, you have
multiples? projected free cash flow for each year through 2014 as follows:
I. Enterprise (Transaction) Value / EBITDA
II. Price/Earnings Year 2014 2015 2016 2017 2018 2019 2020
III. Enterprise (Transaction) Value / Sales - ANSWER--1 and 3 only Free Cash Flow 110 120 150 170 200 250 280
On January 1, 2014, shares of Company X trade at $6.50 per share, with
400 million shares outstanding. The company has net debt of $300
