TRANSACTION COMPS MODELLING WALL STREET PREP EXAM NEWEST 2024 ACTUAL EXAM ALL 50
QUESTIONS AND CORRECT DETAILED ANSWERS
What is generally not considered to be a pre-tax non-recurring (unusual or infrequent) item? - (answer)
Extraordinary gains/losses
what is false about depreciation and amortization - (answer) D&A may be classified within interest
expense
Company X's current assets increased by $40 million from 2007-2008 while the companies current
liabilities increased by $25 million over the same period. the cash impact of the change in working
capital was - (answer) a decrease of 15 million
the final component of an earnings projection model is calculating interest expense. the calculation may
create a circular reference because - (answer) interest expense affects net income, which affects FCF,
which affects the amount of debt a company pays down, which, in turn affects the interest expense,
hence the circular reference
a 10-q financial filing has all of the following characteristics except - (answer) issued four times a year.
Depreciation Expense found in the SG&A line of the income statement for a manufacturing firm would
most likely be attributable to which of the following - (answer) computers used by the accounting
department
If a company has projected revenues of $10 billion, a gross profit margin of 65%, and projected SG&A
expenses of $2billion, what is the company's operating (EBIT) margin? - (answer) 45%
A company has the following information, 1. 2014 revenues of $5 billion,2013 Accounts receivable of
$400 million, 2014 accounts receivable of $600 million, what are the days sales outstanding - (answer)
36.5
A company has the following information:
• 2014 Revenues of $8 billion
• 2014 COGS of $5 billion
• 2013 Accounts receivable of $400 million
, TRANSACTION COMPS MODELLING WALL STREET PREP EXAM NEWEST 2024 ACTUAL EXAM ALL 50
QUESTIONS AND CORRECT DETAILED ANSWERS
• 2014 Accounts receivable of $600 million
• 2013 Inventories of $1 billion
• 2014 Inventories of $800 million
• 2013 Accounts payable of $250 million
• 2014 Accounts payable of $300 million
What are the inventory days for the company? - (answer) 65.7 days
Which of the following is true - (answer) Coca Cola's brand name is not reflected as an intangible asset
on its balance sheet
A company has the following information:
• 2014 share repurchase plan of $4 billion
• Average share price of $60 for the year 2013
• Expected EPS growth for 2014 of 10%
What should the number of shares repurchased by the company be in your financial model? - (answer)
60.6 million
non-controlling interest - (answer) is an expense on the income statement and equity o the balance
sheet
A company has the following information:
• 2013 retained earnings balance of $12 billion
• Net income of $3.5 billion in 2014
• Capex of $200 million in 2014
• Preferred dividends of $100 million in 2014
• Common dividends of $400 million in 2014
What is the retained earnings balance at the end of 2014? - (answer) 15 billion
QUESTIONS AND CORRECT DETAILED ANSWERS
What is generally not considered to be a pre-tax non-recurring (unusual or infrequent) item? - (answer)
Extraordinary gains/losses
what is false about depreciation and amortization - (answer) D&A may be classified within interest
expense
Company X's current assets increased by $40 million from 2007-2008 while the companies current
liabilities increased by $25 million over the same period. the cash impact of the change in working
capital was - (answer) a decrease of 15 million
the final component of an earnings projection model is calculating interest expense. the calculation may
create a circular reference because - (answer) interest expense affects net income, which affects FCF,
which affects the amount of debt a company pays down, which, in turn affects the interest expense,
hence the circular reference
a 10-q financial filing has all of the following characteristics except - (answer) issued four times a year.
Depreciation Expense found in the SG&A line of the income statement for a manufacturing firm would
most likely be attributable to which of the following - (answer) computers used by the accounting
department
If a company has projected revenues of $10 billion, a gross profit margin of 65%, and projected SG&A
expenses of $2billion, what is the company's operating (EBIT) margin? - (answer) 45%
A company has the following information, 1. 2014 revenues of $5 billion,2013 Accounts receivable of
$400 million, 2014 accounts receivable of $600 million, what are the days sales outstanding - (answer)
36.5
A company has the following information:
• 2014 Revenues of $8 billion
• 2014 COGS of $5 billion
• 2013 Accounts receivable of $400 million
, TRANSACTION COMPS MODELLING WALL STREET PREP EXAM NEWEST 2024 ACTUAL EXAM ALL 50
QUESTIONS AND CORRECT DETAILED ANSWERS
• 2014 Accounts receivable of $600 million
• 2013 Inventories of $1 billion
• 2014 Inventories of $800 million
• 2013 Accounts payable of $250 million
• 2014 Accounts payable of $300 million
What are the inventory days for the company? - (answer) 65.7 days
Which of the following is true - (answer) Coca Cola's brand name is not reflected as an intangible asset
on its balance sheet
A company has the following information:
• 2014 share repurchase plan of $4 billion
• Average share price of $60 for the year 2013
• Expected EPS growth for 2014 of 10%
What should the number of shares repurchased by the company be in your financial model? - (answer)
60.6 million
non-controlling interest - (answer) is an expense on the income statement and equity o the balance
sheet
A company has the following information:
• 2013 retained earnings balance of $12 billion
• Net income of $3.5 billion in 2014
• Capex of $200 million in 2014
• Preferred dividends of $100 million in 2014
• Common dividends of $400 million in 2014
What is the retained earnings balance at the end of 2014? - (answer) 15 billion
