Financial HistorySTART HEREEnter data in the yellow cells only. Comments to help you are in blue or red font. Take one row at a time.CURRENCY:USD<-- This is the organization's home or functional currency. E.g., USD, INR (Indian Rupee), BRL (Brazilian Real), EUR (Euro), CNY (Chinese Yuan). Information is found on financial statements.SCALING: x1,000<-- Local currency units: Could be 1 (so 1 means 1), 1000 (so 1 = 1,000), or 1,000,000 (so 1 = 1.0 million). Usually 1000 is used. Information is found on financial statements.Starbucks Corporation<-- Any financial report should show the name of the organization in the heading.INCOME STATEMENT HIGHLIGHTS<-- Always identify the type of report.Unaudited; Amounts USD x 1000<-- The currency and scaling needs to be defined.For Fiscal Years endedOctober[Day]<-- An organization's fiscal year might end on Dec 31, or June 30, or something else. State it here.% Growth vs Prior Year20162015201420162015<-- Replace leftmost year number (Cell C9) with most recent year of data available.TOTAL REVENUE$ 21,315,900.0$ 19,162,700.0$ 16,447,800.011.2%16.5%Cost of Goods Sold$ 8,511,100.0$ 7,787,500.0$ 6,858,800.09.3%13.5%Gross Profit or (Loss)$ 12,804,800.0$ 11,375,200.0$ 9,589,000.012.6%18.6%Other Operating Expenses$ 8,632,900.0$ 7,774,200.0$ 6,507,900.011.0%19.5%OPERATING INCOME$ 4,171,900.0$ 3,601,000.0$ 3,081,100.015.9%16.9%Interest Income or (Expense), Net$ 108,000.0$ 372,500.0$ 142,700.0-71.0%161.0%<--Be sure to enter interest income as a positive number; interest expense as a negative number.Other Income or (Expense), Net$ (81,300.0)$ (70,500.0)$ (64,100.0)-15.3%-10.0%<--Be sure to enter other income as a positive number, other expense as a negative number.Income before Tax Provision$ 4,198,600.0$ 3,903,000.0$ 3,159,700.07.6%23.5%Provision for Income Taxes$ 1,511,496.0$ 1,143,700.0$ 1,092,000.032.2%4.7%Net Income or (Loss) from Continuing Operations$ 2,687,104.0$ 2,759,300.0$ 2,067,700.0-2.6%33.4%<--FYI, most analysts consider this better than total Net Income as an indicator of underlying business performance.Discontinued Operations Income (Loss), Net$ - 0$ - 0$ - 00.0%0.0%<--Typically, from shutting down or selling part of the business.NET INCOME OR (LOSS)$ 2,687,104.0$ 2,759,300.0$ 2,067,700.0-2.6%33.4%<--Confirm this matches what is listed on the financial statement you downloaded.Average Diluted Shares Outstanding$ 1,900,000.0$ 1,820,000.0$ 1,350,000.04.4%34.8%<--Make sure this value is scaled the same way as the other numbers (thousands or millions).DILUTED EARNINGS OR (LOSS) PER SHARE$ 1.41$ 1.52$ 1.53-6.7%-1.0%Net Income Margin %12.6%14.4%12.6%<--Net income or Loss / Total Revenue. Typical values are 2% to 20%, but it can be negative, too.Common Stock Share Price at each Year-End$ 55.52$ 60.03$ 41.03-7.5%46.3%<--Mergent Online instructions include how to find historical stock prices. Go back four years because you wi ...

1. Financial HistorySTART HEREEnter data in the yellow cells
only. Comments to help you are in blue or red font. Take one
row at a time.CURRENCY:USD<-- This is the organization's
home or functional currency. E.g., USD, INR (Indian Rupee),
BRL (Brazilian Real), EUR (Euro), CNY (Chinese Yuan).
Information is found on financial statements.SCALING:
x1,000<-- Local currency units: Could be 1 (so 1 means 1),
1000 (so 1 = 1,000), or 1,000,000 (so 1 = 1.0 million). Usually
1000 is used. Information is found on financial
statements.Starbucks Corporation<-- Any financial report
should show the name of the organization in the
heading.INCOME STATEMENT HIGHLIGHTS<-- Always
identify the type of report.Unaudited; Amounts USD x 1000<--
The currency and scaling needs to be defined.For Fiscal Years
endedOctober[Day]<-- An organization's fiscal year might end
on Dec 31, or June 30, or something else. State it here.%
Growth vs Prior Year20162015201420162015<-- Replace
leftmost year number (Cell C9) with most recent year of data
available.TOTAL REVENUE$ 21,315,900.0$ 19,162,700.0$
16,447,800.011.2%16.5%Cost of Goods Sold$ 8,511,100.0$
7,787,500.0$ 6,858,800.09.3%13.5%Gross Profit or (Loss)$
12,804,800.0$ 11,375,200.0$ 9,589,000.012.6%18.6%Other
Operating Expenses$ 8,632,900.0$ 7,774,200.0$
6,507,900.011.0%19.5%OPERATING INCOME$ 4,171,900.0$
3,601,000.0$ 3,081,100.015.9%16.9%Interest Income or
(Expense), Net$ 108,000.0$ 372,500.0$ 142,700.0-
71.0%161.0%<--Be sure to enter interest income as a positive
number; interest expense as a negative number.Other Income or
(Expense), Net$ (81,300.0)$ (70,500.0)$ (64,100.0)-15.3%-
10.0%<--Be sure to enter other income as a positive number,
other expense as a negative number.Income before Tax
Provision$ 4,198,600.0$ 3,903,000.0$
3,159,700.07.6%23.5%Provision for Income Taxes$
1,511,496.0$ 1,143,700.0$ 1,092,000.032.2%4.7%Net

2. Income or (Loss) from Continuing Operations$ 2,687,104.0$
2,759,300.0$ 2,067,700.0-2.6%33.4%<--FYI, most analysts
consider this better than total Net Income as an indicator of
underlying business performance.Discontinued Operations
Income (Loss), Net$ - 0$ - 0$ - 00.0%0.0%<--Typically,
from shutting down or selling part of the business.NET
INCOME OR (LOSS)$ 2,687,104.0$ 2,759,300.0$
2,067,700.0-2.6%33.4%<--Confirm this matches what is listed
on the financial statement you downloaded.Average Diluted
Shares Outstanding$ 1,900,000.0$ 1,820,000.0$
1,350,000.04.4%34.8%<--Make sure this value is scaled the
same way as the other numbers (thousands or
millions).DILUTED EARNINGS OR (LOSS) PER SHARE$
1.41$ 1.52$ 1.53-6.7%-1.0%Net Income Margin
%12.6%14.4%12.6%<--Net income or Loss / Total Revenue.
Typical values are 2% to 20%, but it can be negative,
too.Common Stock Share Price at each Year-End$ 55.52$
60.03$ 41.03-7.5%46.3%<--Mergent Online instructions
include how to find historical stock prices. Go back four years
because you will need fourth year for Line 123.Total Equity
Value (= share price x shares)$ 105,488,000.0$
109,254,600.0$ 55,390,500.0<--Better to use end-of-year
shares outstanding, but this figure is close enough for this
course.Price / Earnings Ratio (P/E)39.2639.6026.79-
0.9%47.8%<--Market price at the end of the year divided by
that year's earnings per share. Typical values are 10 to
30.Source: [Title (May 20th). Retrieved from
https://www.sec.gov/Archives/edgar/data/829224/000082922416
000083/sbux-
1022016x10xk.htm#sA81B26E970E8EBC307543265204EBB47
<--Include APA citation for where you found the financial
statement data.Starbucks CorporationCASH FLOW
STATEMENT HIGHLIGHTSUnaudited; Amounts USD x
1000For Fiscal Years ended October [Day]% Growth vs Prior
Year20162015201420162015Net Income or (Loss), from
Above$ 2,687,104.00$ 2,759,300.00$ 2,067,700.00-

3. 2.6%33.4%Depreciation and Amortization Expense$
1,030,100.00$ 933,800.00$ 748,400.0010.3%24.8%<--This is
a noncash expense, so we add it back to net income here.Other
Operating Sources and (Uses)$ 857,896.00$ 56,000.00$
(2,208,300.00)1432.0%102.5%<--These are working capital
changes and other adjustments.Cash Flow from Operating
Activities$ 4,575,100.00$ 3,749,100.00$
607,800.0022.0%516.8%<--By entering the total here, the row
above will be automatically calculated.(Capital Expenditures,
Net of Disposals)$ (2,247,800.00)$ (1,242,800.00)$
(798,600.00)-80.9%-55.6%<-- This is normally a negative
number.Other Investing Activities$ 24,900.00$ (277,500.00)$
(19,100.00)109.0%-1352.9%<-- This is normally a negative
number.Cash Flow from Investing Activities$ (2,222,900.00)$
(1,520,300.00)$ (817,700.00)-46.2%-85.9%<-- This is
normally a negative number.Increase or (Decrease) in Debt$
1,254,500.00$ 238,400.00$ 748,500.00426.2%-68.1%<--
Borrowing money is a source of cash; repaying it is a use of
cash.(Dividend Payments)$ (3,012,900.00)$ (2,533,100.00)$
(1,402,000.00)-18.9%-80.7%<-- Dividend payments should
normally be a negative number, because they are a cash
outflow.Other Financing Activities$ (114,400.00)$
(93,600.00)$ (84,200.00)-22.2%-11.2%Cash Flow from
Financing Activities$ (1,872,800.00)$ (2,388,300.00)$
(737,700.00)21.6%-223.7%Cumulative Translation Adjustment$
- 0$ - 0$ - 00.0%0.0%<--Don't try to understand what this
number means at this time. It is applicable to most
multicurrency organizations.NET CASH FLOW$ 479,400.00$
(159,500.00)$ (947,600.00)400.6%83.2%<--Confirm this
matches what is listed on the financial statement you
downloaded.Memo: Free Cash Flow$ 2,327,300.00$
2,506,300.00$ (190,800.00)-7.1%1413.6%<--Usually defined
as Cash Flow from Operating Actitivies less Capital
Expenditures. Note: If the latter is a negative number, then the
formula is Op Cash Flow + Cap Exp, e.g., 1,000 + -100 = 900.
Free Cash Flow must be less than Operating Cash Flow.Source:

4. [Title (May 20th). Retrieved from
https://www.sec.gov/Archives/edgar/data/829224/000082922416
000083/sbux-
1022016x10xk.htm#sA81B26E970E8EBC307543265204EBB47
Starbucks CorporationBALANCE SHEET
HIGHLIGHTSUnaudited; Amounts USD x 1000For Fiscal Years
ended October [Day]% Growth vs Prior
Year20162015201420162015Current AssetsCash and
Marketable Securities$ 2,128,800.00$ 1,530,100.00$
1,708,400.0039.1%-10.4%Accounts Receivable, Net$
768,800.00$ 719,000.00$ 948,400.006.9%-24.2%<--These
amounts are for invoices the organization has sent to clients,
but that they have not yet paid.All Other Current Assets$
1,862,900.00$ 1,721,900.00$ 1,511,900.008.2%13.9%Total
Current Assets$ 4,760,500.00$ 3,971,000.00$
4,168,700.0019.9%-4.7%<--Enter total current assets values,
and the spreadsheet will calculate "other current assets."Non-
current AssetsProperty, Plant and Equipment, Net$
4,533,800.00$ 4,088,300.00$ 3,519,000.0010.9%16.2%<--
These are for PP&E net of accumulated depreciation.Goodwill
and Other Intangible Assets$ 1,719,600.00$ 1,575,400.00$
856,200.009.2%84.0%<--Includes intellectual property (IP),
such as patents and acquired technology.Other Non-current
Assets$ 3,315,600.00$ 2,781,600.00$
2,209,000.0019.2%25.9%Total Non-current Assets$
9,569,000.00$ 8,445,300.00$
6,584,200.0013.3%28.3%TOTAL ASSETS$ 14,329,500.00$
12,416,300.00$ 10,752,900.0015.4%15.5%<--Enter Total
Assets, and the spreadsheet will calculate Total Noncurrent
Assets and Other Noncurrent Assets.Current LiabilitiesAccounts
Payable, Net$ 2,975,700.00$ 2,664,300.00$
2,244,200.0011.7%18.7%<--These are for bills the organization
has received but not yet paid.Other Current Liabilities$
1,571,200.00$ 983,800.00$ 794,500.0059.7%23.8%Total
Current Liabilities$ 4,546,900.00$ 3,648,100.00$
3,038,700.0024.6%20.1%Non-current LiabilitiesLong-term

5. Debt$ 3,202,200.00$ 2,347,500.00$
2,048,300.0036.4%14.6%Other Non-current Assets$
696,400.00$ 602,700.00$ 393,900.0015.5%53.0%Total Non-
current Liabilities$ 3,898,600.00$ 2,950,200.00$
2,442,200.0032.1%20.8%TOTAL LIABILITIES$
8,445,500.00$ 6,598,300.00$
5,480,900.0028.0%20.4%SHAREOWNERS' EQUITYCommon
Stock, at par$ 1,500.00$ 1,500.00$ 700.00Additional Paid-
in Capital$ 41,100.00$ 41,100.00$ 38,400.00Retained
Earnings$ 5,949,800.00$ 5,974,800.00$ 5,206,600.00CTA
and Other$ (108,400.00)$ (199,400.00)$ 26,300.00TOTAL
SHAREOWNERS' EQUITY$ 5,884,000.00$ 5,818,000.00$
5,272,000.00<--By definition, shareowners' equity equals total
assets minus total liabilities. Confirm this matches what is
listed on the financial statement you downloaded.Source: [Title
(May 20th). Retrieved from
https://www.sec.gov/Archives/edgar/data/829224/000082922416
000083/sbux-
1022016x10xk.htm#sA81B26E970E8EBC307543265204EBB47
Starbucks CorporationSELECTED FINANCIAL
RATIOSUnaudited; Amounts USD x 1000For Fiscal Years
ended October [Day]% Growth vs Prior
Year20162015201420162015FINANCIAL RATIOSPrice /
Earnings Ratio39.339.339.30.0%0.0%<--Price per Share /
Earnings per Share. Typical values are 10 to 40.Debt / Equity
Ratio1.41.41.40.0%0.0%<--Total Liabilities / Total
Shareowners' Equity. Typical values are 0.2 to 0.6.Return on
Equity (ROE) %45.7%45.7%45.7%0.0%0.0%<--Net Income /
Total Shareowners' Equity. Typical values are 2% to
40%.Return on Assets (ROA) %18.8%18.8%18.8%0.0%0.0%<--
Net Income / Total Assets. Typical values are 2% to 40%.
Almost always LOWER than ROE.Net Profit Margin
%12.6%12.6%12.6%0.0%0.0%<--Net Income / Total Revenue.
Typical values are 1% to 15%.Free Cash Flow$ 2,327,300.00$
2,327,300.00$ 2,327,300.000.0%0.0%<--Net Cash Flow minus
Capital Expenditures. Value is almost always LESS THAN net

6. cash flow.OTHER USEFUL RATIOSEarnings per Share or
EPS$ 1.4143$ 1.4143$ 1.41430.0%0.0%<--Net Income /
Diluted Shares Outstanding. Typical values are $1.00 to $10.00.
May also be negative.Current Ratio1.01.01.00.0%0.0%<--
Current Assets / Current Liabilities. Typical values are 0.7 to
1.5.Days Sales Outstanding (DSO)1313130.0%0.0%<--
(Accounts Receivable / Total Revenue) x 365. Typical values
are 5-120. Lower is better.COMMON STOCK PRICEAdjusted
Close Price on or near October [Day]$ 55.52$ 60.03$ 41.03-
7.5%46.3%<-- Usually, somewhere between a few dollars and a
couple of hundred dollars per share.RATE OF RETURN
CALCULATIONS2013201420152016Pct Change<--Need fiscal
end-of-year information for four years to calculate three-year
percentage change.Adjusted Close Price at fiscal End of Year
(EOY)$ 78.39$ 55.52-29.2%<--For this, ROR% = ($End -
$Beg) / $Beg. More precisely, you would add dividends
received to the $End value.Annual Dividends per Share$
(1.5857)$ (1.5857)$ (1.5857)<--Approximate dividends/share
are calculated here, but you may want to override those with
disclosed div/share figures.If you buy 1 share at end of fiscal
78.39, collect dividends, then sell at end of fiscal 2016, your 3-
year percent gain would be:-35.2%<--Not required here, but a
more complete measurement.BUT WHAT IF WE VIEW THIS
AS A TIME VALUE OF MONEY QUESTION?Investor's
Annual Cash Flow for 1 Share$ (78.39)
C. Jeffrey Smith: This is negative because we're assuming you
pay this out to buy your 1 share of stock.$ (1.59)$ (1.59)$
53.93<--For an investor who buys 1 share at beginning, collects
dividends, then sells at end of third year.Solve for the annual
Internal Rate of Return or IRR, with N=3 Yrs-13.1%
C. Jeffrey Smith: This will always be LESS THAN 1/3 of the
total 3-yr Percent Change figures above. Why? Because of
COMPOUNDING.<--This IRR is the best overall measure of
this stock's performance over the time period.Source: [Title

7. (May 20th). Retrieved from
https://www.sec.gov/Archives/edgar/data/829224/000082922416
000083/sbux-
1022016x10xk.htm#sA81B26E970E8EBC307543265204EBB47
&F Printed &D Page &P of &N
Capital StructureThis tab is used to calculate Weighted Average
Cost of Capital (WACC). Enter data in the yellow cells only.
Comments to help you are indicated by a red triangle in the top
right corner of cell; hover over the cell to review. Enter
Company Full Name:Starbucks CorporationEnter Fiscal
Year:2016Starbucks CorporationCAPITAL STRUCTUREFor
End of Fiscal Year 2016Unaudited; Amounts USD x
1000SIMPLE METHODTEXTBOOK METHODCapital Funding
Amount
C. Jeffrey Smith: C. Jeffrey Smith:
All of the funds the organization has received from banks,
bond-buyers, stockholders, and other investors.Cost of Capital:
Estimated % Return Req'd by InvestorsCorporate Marginal Tax
Rate %
C. Jeffrey Smith: C. Jeffrey Smith:
Always 0% for stock and retained earnings; may be 0% - 50%
for debt and leases.1 - Corp Tax Rate% Cost of Capital, After
Tax Savings
C. Jeffrey Smith: C. Jeffrey Smith:
Equals Column D times column F.$ Cost of Capital per Year
(Column C x Coumn G)Wgt x Cost% of TotalDebt: Bank
Loans$ 750,000,000.02.1%32.9%67.1%1.4%$
10,574,550.00.5%33.2%Debt:
Bonds500,000,000.02.5%32.9%67.1%1.6%8,224,650.00.4%22.2
%Debt: Commercial
Paper1,000,000,000.00.0%32.9%67.1%0.0%- 00.0%44.3%Debt:
Other or Unidentified- 00.0%32.9%67.1%0.0%-

8. 00.0%0.0%Leases (a form of
Debt)1,223,200.00.0%32.9%67.1%0.0%- 00.0%0.1%Preferred
Stock (if any)- 00.0%0.0%100.0%0.0%- 00.0%0.0%Common
Stock: At Par1,500.00.0%0.0%100.0%0.0%-
00.0%0.0%Common Stock: Add'l Paid-in
Capital41,100.00.0%0.0%100.0%0.0%- 00.0%0.0%Retained
Earnings5,949,800.00.0%0.0%100.0%0.0%- 00.0%0.3%[Other]-
00.0%0.0%100.0%0.0%- 00.0%0.0%TOTAL$
2,257,215,600.0?$ 18,799,200.00.8%100.0%
C. Jeffrey Smith: C. Jeffrey Smith:
The % of Total should always add up to 100.0%. If not, you've
done something wrong.
C. Jeffrey Smith: C. Jeffrey Smith:
Equals Column D times column F.WEIGHTED AVERAGE
COST OF CAPITAL:WACC = [$ Total Annual Cost of Capital]
/ [$ Total Capital Funding] =$18799200 /
$2257215600=0.8%TOTAL DEBT AND EQUITYAmountPct of
TotalTotal Debt, incl. Leases & Preferred
Stock2,251,223,200.099.7%So Debt/Equity Ratio = 375.7Total
Equity, incl "Other"5,992,400.00.3%And Debt/Total Capital
Ratio =1.0TOTAL$ 2,257,215,600.0100.0%NOTES:a)The
Corporate Marginal Tax Rate only affects debt and leases. For
businesses, it is usually between 0% and 50%. For nonprofits
and goverments, it is always 0%.b)Leases are a form of
debt.c)The % annual cost of debt is always less than the %
annual cost of equity.d)Retained Earnings are basically common
stock dividends that have not been paid out. Retained earnings
therefore have the same required rate of return as common
stock.e)The organization's treasurer should be the best source
for all of this information.HOW TO ESTIMATE REQUIRED
RATE OF RETURN FOR COMMON STOCKDividend Growth
Model:($Dividend / $Current Price) + Expected % Dividend
Growth Rate<-- Only works if constant future growth is
expected.Example:($1.50 / $20.00) + 6.5% = 0.075 + 0.065 =

9. 0.140 = 14.0%Intrinsic Value MethodThe internal rate of return
(IRR) of the future cash flows investors expect to receive. Use a
spreadsheet IRR function to calculate.Industry
AveragesEvaluate reasonable estimates for industry averages or
for other organizations with similar risk. Not easy, by the way.
&8&F &A &8Printed &D &8Page &P of &N
ValuationThis tab is used for the corporate valuation report
(Final Project I). Enter data in the yellow cells only.
CURRENCY:USD<-- Probably U.S. dollars, or perhaps another
(e.g., euros or pesos). We will use U.S. dollars.SCALING:
x1,000<-- Could be x1 (such as just dollars), x1000 (meaning
amounts in Thousands), or Millions (meaning amounts in
millions). We will use x1000.Starbucks Corporation -
COMPANY VALUATION(Unaudited; USD 1000)Fiscal Year --
>20162017201820192020202120222023202420252026TotalRE
VENUE21,315,90021,315,90021,315,90021,315,90021,315,900
21,315,90021,315,90021,315,90021,315,90021,315,90021,315,9
00234,474,900Growth Rate vs Prior
Year11.2%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%To
tal Operating
Expenses17,144,00017,144,00017,144,00017,144,00017,144,00
017,144,00017,144,00017,144,00017,144,00017,144,00017,144,
000188,584,000OP INCOME OR
(LOSS)4,171,9004,171,9004,171,9004,171,9004,171,9004,171,9
004,171,9004,171,9004,171,9004,171,9004,171,90045,890,900
Operating
Margin19.6%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%0.0%
Interest & Other Income
(Exp)26,700000000000026,700PRETAX INCOME OR
(LOSS)4,198,6004,171,9004,171,9004,171,9004,171,9004,171,9
004,171,9004,171,9004,171,9004,171,9004,171,900Tax
Provision1,511,4961,501,8841,501,8841,501,8841,501,8841,501
,8841,501,8841,501,8841,501,8841,501,8841,501,88416,530,33
6Discont'd Ops Income (Loss)000000000000NET INCOME OR
(LOSS)2,687,1042,670,0162,670,0162,670,0162,670,0162,670,0

10. 162,670,0162,670,0162,670,0162,670,0162,670,01629,387,264
Diluted Avg
Shares1,900,0001,900,0001,900,0001,900,0001,900,0001,900,0
001,900,0001,900,0001,900,0001,900,0001,900,000DILUTED
EPS$ 1.41$ 1.41$ 1.41$ 1.41$ 1.41$ 1.41$ 1.41$
1.41$ 1.41$ 1.41$ 1.41$ 15.47Net Income or (Loss), from
Above2,687,1042,670,0162,670,0162,670,0162,670,0162,670,01
62,670,0162,670,0162,670,0162,670,0162,670,01629,387,264De
prec'n & Amortiz'n
Expense1,030,1001,030,1001,030,1001,030,1001,030,1001,030,
1001,030,1001,030,1001,030,1001,030,1001,030,10011,331,100
Other Op Sources &
(Uses)857,896857,896857,896857,896857,896857,896857,8968
57,896857,896857,896857,8969,436,856Cash Flow from Op
Activities4,575,1004,558,0124,558,0124,558,0124,558,0124,55
8,0124,558,0124,558,0124,558,0124,558,0124,558,01250,155,2
20(Capital Expenditures, Net of
Disposals)(2,247,800)(2,247,800)(2,247,800)(2,247,800)(2,247,
800)(2,247,800)(2,247,800)(2,247,800)(2,247,800)(2,247,800)(2
,247,800)(24,725,800)Other Investing
Activities24,90024,90024,90024,90024,90024,90024,90024,900
24,90024,90024,900273,900Cash Flow from Invest'g
Activities(2,222,900)(2,222,900)(2,222,900)(2,222,900)(2,222,9
00)(2,222,900)(2,222,900)(2,222,900)(2,222,900)(2,222,900)(2,
222,900)(24,451,900)Increase or (Decrease) in
Debt1,254,50000000000001,254,500(Dividend
Payments)(3,012,900)(2,993,740)(2,993,740)(2,993,740)(2,993,
740)(2,993,740)(2,993,740)(2,993,740)(2,993,740)(2,993,740)(2
,993,740)(32,950,302)Other Financing
Activities(114,400)0000000000(114,400)Cash Flow from
Financ'g
Activities(1,872,800)(2,993,740)(2,993,740)(2,993,740)(2,993,7
40)(2,993,740)(2,993,740)(2,993,740)(2,993,740)(2,993,740)(2,
993,740)(31,810,202)Cumulative Translation
Adjustment000000000000NET CASH
FLOW479,400(658,628)(658,628)(658,628)(658,628)(658,628)(

11. 658,628)(658,628)(658,628)(658,628)(658,628)(6,106,882)Mem
o: Free Cash
Flow2,327,3002,310,2122,310,2122,310,2122,310,2122,310,212
2,310,2122,310,2122,310,2122,310,2122,310,21225,429,420VA
LUATION CALCULATIONSNET CASH FLOW
"NCF"479,400(658,628)(658,628)(658,628)(658,628)(658,628)(
658,628)(658,628)(658,628)(658,628)(658,628)(6,106,882)For
the project analysis, we EXCLUDE the funding proceeds &
repayment.NET PRESENT VALUE OF FUTURE CASH
FLOWSNPV@5.0%$(5,085,752)For low-risk companies. The
value here is what you would be willing to pay to buy the
company under these assumptions.NPV@10.0%$(4,046,985)For
medium-risk companies. The value here is what you would be
willing to pay to buy the company under these
assumptions.NPV@18.0%$(2,959,932)For high-risk companies.
The value here is what you would be willing to pay to buy the
company under these assumptions.If you had bought the whole
company at the end of fiscal 2016 for its actual market value of
--->$105,488,000(From Financial History worksheet)Net Cash
Flow w/
Investment(105,488,000)(658,628)(658,628)(658,628)(658,628)
(658,628)(658,628)(658,628)(658,628)(658,628)(658,628)(112,0
74,282)Cumulative
NCF(105,488,000)(106,146,628)(106,805,256)(107,463,885)(10
8,122,513)(108,781,141)(109,439,769)(110,098,397)(110,757,0
25)(111,415,654)(112,074,282)CF/Mth for Payback
Calc0.000.000.000.000.000.000.000.000.000.000.00Cash Flow
Payback Period11.00YearsAfter that many years, the cumulative
cash flow turns positive. (It could turn negative again in one or
more future years.)If cumulative NCF has more than 1 change
from - to +, payback period may be wrong.Internal Rate of
ReturnERROR:#NUM!IRRAt this discount rate R, the NPV will
equal $0. IRR is a bit dangerous, because there can be more
than one solution.MODIFIED INTERNAL RATE OF RETURN
(MIRR)Financing Rate0.0%<-- This is the assumed cost to
obtain financing. It could be the firm's cost of

12. equity.Reinivestment RateERROR:#NUM!<-- This is the
assumed rate of return you would earn on excess funds. It might
or might not equal the IRR from
above.MIRRERROR:#NUM!MIRRECONOMIC VALUE
ADDED (EVA), ALSO CALLED ECONOMIC PROFITNet
Income (from
above)2,687,1042,670,0162,670,0162,670,0162,670,0162,670,0
162,670,0162,670,0162,670,0162,670,0162,670,01629,387,264I
nvested Capital2,400From Financial History: Common Stock, at
Par + Additional Paid-in Capital =$1,500+$
900.00WACC0.8%From Capital Structure
spreadsheetEVA2,687,0842,669,9962,669,9962,669,9962,669,99
62,669,9962,669,9962,669,9962,669,9962,669,9962,669,99629,
387,044EVA = Net Income - (Invested Capital x
WACC)NOTES:Projections of future cash flows are always
uncertain; consider doing several scenarios of cash flows, such
as most likely, best case,and worst case.You should use a low
discount rate to calculate NPV for low-risk projects such as
replacing equipment; perhaps 5%. Use a higher rate, such
as10%, for medium-risk projects, and use a higher rate of, say,
15% or 20% for the riskiest projects. Ask the company
treasurer.The formula for calculating EVA is: Net Operating
Profit After Taxes (NOPAT) - Invested Capital * Weighted
Average Cost of Capital (WACC)
&8&F &A &8Printed &D &8Page &P of &N
Optional - TVM HelpTime Value of Money (TVM) - Simple
CalculatorsEnter known values in YELLOW cells.Answers will
be in GREEN cells.GENERAL RULES AND DEFINITIONS-
Show cash you give to someone else (e. g., your bank), or
outflows, as negative numbers; and show cash you receive, or
inflows, as positive numbers.-Be clear and consistent about time
periods: Are you doing everything in years, months, or some
other intervals?PVPresent Value. What is happening today, or
what something is worth today.NNumber of Periods. The
number of years or months, or even weeks or days, you are

13. looking at.RRate of Return; or interest rate (sometimes labeled
"i" instead of "r"). This is also the "compounding rate" (when
going from the present to the future) or the"discount rate"
(when going from the future to the past). e.g., 7.5% annual
rate. Remember 7.5% is same as 0.075.PMTAnnuity or
Amortization Payment. Sometimes you are looking at a periodic
loan repayment or a periodic savings or investing
amount.TYPETVM Type. Whether compounding or discounting
is applied at the end of each period, as usually occurs with your
savings accounts (usually "Type = 0"); orwhether compounding
or discounting is applied at the beginning of each period, as is
common with loans ("Type = 1").GENERAL STEPS TO SOLVE
TVM PROBLEMS1aMethodology: Understand the question,
identify the relevant information, and, if required, make
appropriate assumptions.1bMethodology: Draw a timeline and
write down the values for the items you know. Show the units
and be consistent. e.g., if periods (N) are in months,say so, and
make sure your rate of return R is also in months. Don't write
"PV=$1 million" and then "FV="$1,200,000."2Calculation:
Enter the known TVM values and calculate the unknown, using
either the appropriate table below, a hand calculator, an
onlineTVM calculator site, a TVM smartphone app, or your own
Excel or OpenOffice or Google Docs
spreadsheet.3Interpretation: Do a "does this all make sense?"
check. If not, redo. Interpret your final answer. What does it
mean? Why does it make sense?4Communication: Explain the
question, your methodology, and your answer clearly, as if you
are trying to convince your boss!TO CALCULATE THE
FUTURE VALUE OF A PRESENT AMOUNTFormula: FV = PV
(1 + R)^NExample: You deposit money in a bank account, or
invest it by buying a share of stock, and want to know what it
might grow to.PVNRPMTTYPEFVAnnual CompoundingType:
Beginning of Period$ (1,000.00)3.05.00%$ -
01$1,157.63Type: End of Period$ (1,000.00)3.05.00%$ -
00$1,157.63Monthly CompoundingType: Beginning of Period$
(1,000.00)360.4167%$ - 01$1,161.47Type: End of Period$

14. (1,000.00)360.4167%$ - 00$1,161.47TO CALCULATE THE
PRESENT VALUE OF FUTURE AMOUNTFormula: PV = FV /
(1 + R)^NExample: How much should you put aside today to
have a specified amount in the future, assuming N periods and R
rate of return?PVNRPMTTYPEFVAnnual DiscountingType:
Beginning of Period$ (500.16)14.25.00%$ -
01$1,000.00Type: End of Period$ (500.16)14.25.00%$ -
00$1,000.00Monthly DiscountingType: Beginning of Period$
(492.37)170.40.4167%$ - 01$1,000.00Type: End of Period$
(492.37)170.40.4167%$ - 00$1,000.00TO CALCULATE THE
NUMBER OF PERIODSExample: How long will it take to
double your money?PVNRPMTTYPEFVAnnual
CompoundingType: Beginning of Period$
(1,000.00)15.25.00%$ - 01$2,000.00Type: End of Period$
(1,000.00)14.25.00%$ - 00$2,000.00Monthly
CompoundingType: Beginning of Period$
(1,000.00)167.70.4167%$ - 01$2,000.00Type: End of Period$
(1,000.00)166.70.4167%$ - 00$2,000.00TO CALCULATE
THE RATE OF RETURNExample: What rate of return do I need
to pay for my kids' college if I save $X each
year?PVNRPMTTYPEFVAnnual CompoundingType: Beginning
of Period$ - 08.09.00%$ (1,455.78)1$17,500.00Type: End of
Period$ - 08.011.37%$ (1,455.78)0$17,500.00Monthly
CompoundingType: Beginning of Period$ - 0960.7935%$
(121.32)1$17,500.00Type: End of Period$ - 0960.8084%$
(121.32)0$17,500.00TO CALCULATE PERIODIC LOAN OR
SAVINGS PAYMENTSExample: What will my car loan
payments be? PVNRPMTTYPEFVAnnual CompoundingType:
Beginning of Period$ -
08.09.00%($1,455.78)1$17,500.00Type: End of Period$ -
08.09.00%$ (1,586.80)0$17,500.00Monthly
CompoundingType: Beginning of Period$ - 0960.7500%$
(124.20)1$17,500.00Type: End of Period$ - 0960.7500%$
(125.13)0$17,500.00NOTE: TOTAL PAYMENTSOF THE
GRAND TOTAL PMTSOF THE PERIODIC PAYMENTS
ABOVE:PER YEARGRAND

15. TOTALPRINCIPALINTERESTAnnual CompoundingType:
Beginning of Period$ (1,455.78)($11,646.25)$ -
0($11,646.25)Type: End of Period$ (1,586.80)$ (12,694.41)$
- 0$ (12,694.41)Monthly CompoundingType: Beginning of
Period$ (1,490.36)$ (11,922.92)$ - 0$ (11,922.92)Type:
End of Period$ (1,501.54)$ (12,012.34)$ - 0$
(12,012.34)TO CALCULATE NET PRESENT VALUE
(NPV)Example: What is the value today of a series of future
cash flows?NOTE: Extend timeline for however many periods
you need -->Timeline Periods -->012345678TOTALCOSTS
(Negative)Initial Investment, if any$ (5,000)$ -$ -$ -$ -$
-$ -$ -$ -$ (5,000)Regular operating
costs(100)(100)(100)(100)(100)(100)(100)(100)(800)Ending
shutdown or cleanup costs---------Opportunity
cost(25)(25)(25)(25)(25)(25)(25)(25)(200)Cannibalization (if
any)(10)(12)(15)(15)(15)(15)(15)(15)(112)Other costs (excl
sunk costs)---------BENEFITS (Positive)New sales
revenue503005006006006006007003,950Add'l sales of existing
stuff---------Cost savings51010101010101075Other incremental
benefits---------TOTALNET CASH FLOW$ (5,000)$ (80)$
173$ 370$ 470$ 470$ 470$ 470$ 570-2087For
R=10.00%NPV($2,970)Note: "R" should be the risk-adjusted
required rate of return for an investment of this estimated level
of risk. It is usually between 3.0% and 20%.Note: Projections of
future cash flows are almost always highly uncertain. Consider
different scenarios, such as most likely, best case, and worst
case.
&8&F &8Printed &D &8Page &P of &N
Sheet1Month ->123456789101112Interest
Rate0.8333%0.8333%0.8333%0.8333%0.8333%0.8333%0.8333
%0.8333%0.8333%0.8333%0.8333%0.8333%Start of
Month$1,000.00$1,008.33$1,016.74$1,025.21$1,033.75$1,042.3
7$1,051.05$1,059.81$1,068.64$1,077.55$1,086.53$1,095.58Inte
rest
Charge$8.33$8.40$8.47$8.54$8.61$8.69$8.76$8.83$8.91$8.98$

16. 9.05$9.13End of
Month$1,008.33$1,016.74$1,025.21$1,033.75$1,042.37$1,051.0
5$1,059.81$1,068.64$1,077.55$1,086.53$1,095.58$1,104.71
Help-DepreciationDOES DEPRECIATION EXPENSE AFFECT
CASH FLOW?SITUATION-Suppose you have a really simple
business: you've bought a new 3-D printer, and you rent it out
to fellow SNHU students for $4000/yr.-The students who rent
the printer are responsible for supplies and maintenance.-You
estimate the printer's useful life is 3 years, and at the end of
that time you can sell it for $500.-Accounting rules require you
to "recognize" the printer's cost by spreading it over the
estimated useful life.YEAR 1YEAR 2YEAR
3CUMULATIVE1.You buy the printer for cash, & sell it 3 yrs
later.Investment$ (10,000)$ - 0$ 500$ (9,500)2.You rent it
to other students for $4,000 / yearRevenue$ 4,000$ 4,000$
4,000$ 12,0003.You record depreciation expense for the
printerExpense$ (3,167)$ (3,167)$ (3,167)$ (9,500)Notice
the "Cumulative" column: Cumulative depreciation equals
cumulative cash flow. Depreciation is simply a spreading out of
the cash flow.IN A REALLY SIMPLE WORLD, YOUR
FINANCIALS MIGHT LOOK LIKE THIS:REVENUE$ 4,000$
4,000$ 4,000$ 12,000Buying and Selling of 3-D Printer$
(10,000)$ - 0$ 500$ (9,500)PRETAX PROFIT OR (LOSS),
EQUALS PRETAX CASH FLOW$ (6,000)$ 4,000$ 4,500$
2,500Tax Refunds or (Payments), @ 40% Tax Rate$ 2,400$
(1,600)$ (1,800)$ (1,000)NET PROFIT OR (LOSS),
EQUALS NET CASH FLOW$ (3,600)$ 2,400$ 2,700$
1,500Notice that the net profit line is rather lumpy.BUT YOUR
ACCOUNTING INCOME STATEMENTS WILL LOOK LIKE
THIS:REVENUE$ 4,000$ 4,000$ 4,000$
12,000Depreciation Expense$ (3,167)$ (3,167)$ (3,167)$
(9,500)OPERATING PROFIT OR (LOSS)$ 833$ 833$ 833$
2,500Tax Provision Expense @40% Tax Rate$ (333)$ (333)$
(333)$ (1,000)NET PROFIT (OR LOSS)$ 500$ 500$ 500$
1,500Notice that the net profit line above is smooth, but the
Cumulative column hasn't changed.AND YOUR CASH FLOW

17. STATEMENTS (STANDARD FORMAT) WILL LOOK LIKE
THIS:Net Profit (Or Loss) from Above$ 500$ 500$ 500$
1,500Add back: Depreciation Expense$ 3,167$ 3,167$
3,167$ 9,500Change in Working Capital & Other Operating
Activities$ - 0$ - 0$ - 0$ - 0Cash Flow From Operating
Activities$ 3,667$ 3,667$ 3,667$ 11,000Capital
Expenditures$ (10,000)$ - 0$ - 0$ (10,000)Proceeds from
Sale of Assets$ - 0$ - 0$ 500$ 500Cash Flow from
Investing Activities$ (10,000)$ - 0$ 500$
(9,500)Additional Paid-in Capital$ - 0$ - 0$ - 0$ -
0Dividends Paid$ - 0$ - 0$ - 0$ - 0Cash Flow from
Financing Activities$ - 0$ - 0$ - 0$ - 0NET CASH FLOW$
(6,333)$ 3,667$ 4,167$ 1,500Cash Balance at Beginning Of
Year$ 10,000$ 3,667$ 7,333Cash Balance at End of Year$
3,667$ 7,333$ 11,500