The document discusses cashflow budgets for startups. It provides an example of transforming an operating budget into a cashflow budget by transferring revenue and cost items to show monthly cash inflows and outflows. However, the cashflow budget must also account for additional payments like withdrawals, deposits, and large purchases not captured in the operating budget. Delayed customer payments and supplier payment terms further complicate the cashflow projections. The cashflow budget is necessary to determine if and when additional financing may be required beyond initial startup funding.
This document provides an introduction to key financial planning concepts for entrepreneurs through the example of budgeting for a holiday cottage business. It defines important terms like establishing budget, operating budget, turnover, variable costs, contribution margin, contribution margin ratio, fixed costs, depreciation, and net profit. The example operating budget calculates that the holiday cottage business could earn a net profit of 22,000 Danish kroner per year based on assumptions for revenue, variable costs, fixed costs, depreciation, and interest payments.
The document discusses different types of budgets that are important for startups, including:
1) An establishing budget that outlines the costs to get a startup launched.
2) An operating budget/income statement that projects revenues, costs, and profits on a monthly or annual basis to understand when a profit may be achieved.
3) A cash flow budget to determine funding needs by projecting cash inflows and outflows over time.
Budgets are seen as important planning tools for startups to test assumptions, set goals, and demonstrate viability to investors, but should be viewed as flexible financial simulations rather than rigid predictions since startups involve uncertainty.
This document provides an example budget for a small retail startup presented across multiple sections, including an establishing budget, operating budget, funding budget, sensitivity analysis, and notes. The establishing budget outlines initial costs such as rent, interior work, equipment, and stock. The operating budget forecasts revenue, costs, and profits. The funding budget shows the capital needs and proposed sources of funding. The sensitivity analysis illustrates the budget under different scenarios. The notes provide additional details on assumptions around contribution margins, wages, and costs.
The document provides guidance on creating budgets for a new business. It discusses the importance of budgets for obtaining funding from investors and banks, and how budgets can help turn a business vision into measurable goals. It recommends establishing budgets for startup costs, operating costs, sales prices, cash flow, and funding needs. Sample budgets are provided, including operating budgets showing income statements and cash flow over multiple years. The document stresses that budgets should be used as a financial simulation and management tool rather than an attempt to precisely predict the future, as startups involve experimentation.
The documents provide information about establishing budgets for startups and new businesses. It discusses the importance of budgets, different types of budgets including establishing budgets, operating budgets, cash flow budgets, and financing budgets. It provides examples of budgets with numbers and financial projections. It also discusses estimating sales, costs, and profits. Budgets help understand the financial needs and viability of a business idea.
To calculate necessary turnover to reach profitability, you need to know fixed costs, desired profit, and contribution margin ratio. The necessary turnover is equal to the sum of fixed costs and desired profit divided by the contribution margin percentage. You should estimate contribution margin, decide on a desired profit level, and run simulations adjusting variables like contribution margin, salary, hiring, and premises costs to determine necessary turnover under different scenarios.
Financial statements and budgets are important for startups to answer crucial questions around costs, profits, and financing needs. Key elements include sales budgets, operating budgets, cashflow budgets, and financing budgets. These provide information for decisions on financing, track business performance against plans, and test the realism of business assumptions. Estimating costs, revenues, and profits requires making assumptions around factors like market size, sales prices, costs, and growth. Cashflow management is also critical, as cashflow budgets track incoming and outgoing payments to manage liquidity.
The document contains journal entries and calculations for accounting exercises. It provides solutions to exercises involving journal entries for transactions, depreciation calculations using different methods, adjusting entries at fiscal period-end, inventory calculations, and ratio calculations. Key information includes journal entries to record purchases, sales, expenses and adjusting entries. Calculations show depreciation expense and accumulated depreciation amounts.
This document provides an introduction to key financial planning concepts for entrepreneurs through the example of budgeting for a holiday cottage business. It defines important terms like establishing budget, operating budget, turnover, variable costs, contribution margin, contribution margin ratio, fixed costs, depreciation, and net profit. The example operating budget calculates that the holiday cottage business could earn a net profit of 22,000 Danish kroner per year based on assumptions for revenue, variable costs, fixed costs, depreciation, and interest payments.
The document discusses different types of budgets that are important for startups, including:
1) An establishing budget that outlines the costs to get a startup launched.
2) An operating budget/income statement that projects revenues, costs, and profits on a monthly or annual basis to understand when a profit may be achieved.
3) A cash flow budget to determine funding needs by projecting cash inflows and outflows over time.
Budgets are seen as important planning tools for startups to test assumptions, set goals, and demonstrate viability to investors, but should be viewed as flexible financial simulations rather than rigid predictions since startups involve uncertainty.
This document provides an example budget for a small retail startup presented across multiple sections, including an establishing budget, operating budget, funding budget, sensitivity analysis, and notes. The establishing budget outlines initial costs such as rent, interior work, equipment, and stock. The operating budget forecasts revenue, costs, and profits. The funding budget shows the capital needs and proposed sources of funding. The sensitivity analysis illustrates the budget under different scenarios. The notes provide additional details on assumptions around contribution margins, wages, and costs.
The document provides guidance on creating budgets for a new business. It discusses the importance of budgets for obtaining funding from investors and banks, and how budgets can help turn a business vision into measurable goals. It recommends establishing budgets for startup costs, operating costs, sales prices, cash flow, and funding needs. Sample budgets are provided, including operating budgets showing income statements and cash flow over multiple years. The document stresses that budgets should be used as a financial simulation and management tool rather than an attempt to precisely predict the future, as startups involve experimentation.
The documents provide information about establishing budgets for startups and new businesses. It discusses the importance of budgets, different types of budgets including establishing budgets, operating budgets, cash flow budgets, and financing budgets. It provides examples of budgets with numbers and financial projections. It also discusses estimating sales, costs, and profits. Budgets help understand the financial needs and viability of a business idea.
To calculate necessary turnover to reach profitability, you need to know fixed costs, desired profit, and contribution margin ratio. The necessary turnover is equal to the sum of fixed costs and desired profit divided by the contribution margin percentage. You should estimate contribution margin, decide on a desired profit level, and run simulations adjusting variables like contribution margin, salary, hiring, and premises costs to determine necessary turnover under different scenarios.
Financial statements and budgets are important for startups to answer crucial questions around costs, profits, and financing needs. Key elements include sales budgets, operating budgets, cashflow budgets, and financing budgets. These provide information for decisions on financing, track business performance against plans, and test the realism of business assumptions. Estimating costs, revenues, and profits requires making assumptions around factors like market size, sales prices, costs, and growth. Cashflow management is also critical, as cashflow budgets track incoming and outgoing payments to manage liquidity.
The document contains journal entries and calculations for accounting exercises. It provides solutions to exercises involving journal entries for transactions, depreciation calculations using different methods, adjusting entries at fiscal period-end, inventory calculations, and ratio calculations. Key information includes journal entries to record purchases, sales, expenses and adjusting entries. Calculations show depreciation expense and accumulated depreciation amounts.
Successful Cash Management For Your Businessrfarnum
This document discusses keys to successful cash flow management for businesses. It covers understanding cash flow and working capital, maximizing cash flow by managing accounts receivable and payable, and tips and tools for implementing a cash flow management strategy including depository and credit card services. The presentation aims to provide businesses with information and strategies for monitoring and improving cash flow through metrics like current ratio and inventory and receivables turnover. It also offers advice for managing cash flow crises by adjusting cash inflows and outflows.
The document provides an overview of key concepts in accounting for plant assets, natural resources, and intangible assets from Chapter 8, including determining the cost of plant assets, depreciation methods, revising periodic depreciation, accounting for natural resources, intangible assets, exchanging plant assets, and calculating the asset turnover ratio. It includes examples and exercises for each concept with step-by-step solutions.
The document contains review questions and scenarios relating to recording business transactions using accrual accounting. It includes:
1) A table to complete showing the accounting equation for various entities.
2) Scenarios to determine which are business transactions, including purchasing stock on credit, paying electricity bills, and withdrawing assets for personal use.
3) Worksheet examples recording business transactions for entities over a month period, including calculating profit and loss.
The documents provide financial information for a company, including a trial balance, trading and profit & loss account, and balance sheet.
The trial balance lists the company's income, expenses, assets and liabilities to ensure debits equal credits. The trading account shows how gross profit is generated. The profit & loss account lists expenses to determine if there was a net profit. The balance sheet reports the company's assets, liabilities, and capital at a point in time to ensure assets equal the sum of liabilities and capital.
Ms G's Guide to the Restaurant Income StatementMGionti
The document shows the statement of income for the Stowe Room Café for the month ending October 31. Total sales were $426,023 with food sales accounting for 76.44% ($325,658) and beverage sales 23.56% ($100,365). Total cost of goods sold was 34% ($144,826) of total sales. Operating expenses accounted for 47.21% ($201,137) of total sales. After taxes, the net income was 4.47% ($19,023) of total sales.
This document contains an assignment submitted by Akershit Kumar Sharma to Professor Mushtaq Ahmed on April 7, 2013. It includes answers to various questions related to contribution format income statements segmented by territory and product line. The key details provided are contribution format income statements for a company's total sales, segmented by the northern and southern territories, and further segmented of the northern territory by its Paks and Tibs product lines. Analysis is also provided on performance of different territories and product lines.
This document contains 9 problems related to leverage analysis for various companies. The problems include calculating degrees of operating, financial, and combined leverage given income statements and capital structures. They also involve computing earnings per share under different financing scenarios and levels of earnings before interest and taxes.
This document contains examples of correcting entries for accounting errors. The first error was a collection that was incorrectly recorded as a debit to cash and credit to service revenue, when it should have been a debit to accounts receivable and credit to service revenue. The second error was a purchase of supplies that was incorrectly recorded as a debit to supplies and credit to accounts payable for the wrong amount. The document provides the incorrect entry, correct entry, and correcting entry for each error.
1) The document discusses steps in preparing a worksheet and completing the accounting cycle including closing entries.
2) It provides examples of adjusting entries, closing entries, and a classified balance sheet.
3) The objectives are to understand worksheet preparation, closing books, correcting entries, and the classified balance sheet.
Based on the information provided:
- Short-term rates increased to 11%
- Long-term rates remain at 13%
- Temporary current assets remain at $1,000,000
- Permanent current assets remain at $2,000,000
- Fixed assets remain at $1,200,000
- Earnings before interest and taxes remain at $996,000
- Tax rate remains at 40%
With the new short-term rate of 11%, short-term interest expense would be:
Temporary current assets of $1,000,000 at 11% = $110,000
Long-term interest expense and the calculation of earnings after taxes remains the same.
Therefore
Silver Construction Ltd recognizes gross profit of P80,000 in 2013 and P120,000 in 2014 using the percentage-of-completion method based on costs incurred. GPC Ltd recognizes gross profit of P150,000 in 2009 on contract #3814 using the percentage-of-completion method based on costs incurred and estimated costs to complete. Masikap Construction Co recognizes gross profit of P600,000 in 2010 and P840,000 in 2011 on a fixed-price construction contract using the percentage-of-completion method based on percentage of completion and estimated total costs.
The document discusses adjusting entries for accounting transactions. It provides examples of adjusting entries for depreciation, supplies, prepaid rent, and unearned revenue. It also calculates book value of equipment and the adjusting entry needed for earned revenue that was initially recorded as unearned. Exercises are included for students to practice preparing adjusting entries.
Whole Foods Market reported sales of $6.16 billion for fiscal year 2008 with gross profit of $2.11 billion. Operating income was $213.7 million. Net income for the year was $113 million, or $0.81 per diluted share. The company paid dividends of $0.60 per share for the year.
A trial balance is a list of all ledger account balances on a given date arranged in separate debit and credit columns. It is prepared to test arithmetic accuracy, help prepare financial statements, locate errors, allow comparison, and make adjustments. However, a trial balance does not conclusively prove accuracy as some errors like omissions, original errors, errors of principle, or compensating errors may not be disclosed. The example shows a trial balance prepared from account balances extracted from Mohan Kumar's books on March 31, 2010 with equal totals for debit and credit columns.
This document discusses capital budgeting and risk analysis. It covers the following key points:
1. It discusses different types of project analysis including expansion, replacement, mandatory, safety/regulatory projects.
2. It outlines steps for cash flow analysis including identifying relevant incremental cash flows, developing pro forma financial statements and project cash flows, and considering special cases.
3. It discusses risk analysis tools for capital budgeting including sensitivity analysis, scenario analysis, and simulation analysis to examine the impact of risk on project outcomes.
This document provides information for an intermediate accounting exam including 4 problems related to financial statements, receivables, inventories, and accounting principles. Problem 1 asks students to prepare a statement of financial position. Problem 2 asks students to prepare a comprehensive income statement. Problem 3 involves calculating impairment of receivables. Problem 4 involves inventory costing methods and valuation. Problem 5 asks students to identify violations of accounting assumptions, principles, or constraints for various accounting practices.
Wilkins Kennedy - Business Recovery: Early signs a business is in financial t...misssarahj
Presentation by UK top 20 accountancy firm Wilkins Kennedy, October 2012. How to spot the early warning signs that a business is in financial trouble and the options available to improve the situation.
- Torentino Book Warehouse had various book purchase and sale transactions throughout June under a perpetual inventory system. Transactions included purchases of books from publishers on account, sales of books to retailers on account, returns of books to publishers, payments to publishers, and receipts of payments from retailers.
- Tool Time Hardware Store had various merchandise purchase and sale transactions throughout May. Transactions included purchases and sales of merchandise on account and for cash, returns and allowances, payments to suppliers, and the purchase of supplies.
- Duff Department Store's trial balance at the end of November showed various expense, revenue, asset and liability accounts. Adjusting entries were needed for depreciation, prepaid insurance, and sales commissions. Closing
The document discusses a 4-step program to help consumers save money and generate income by starting their own utilities brokerage business. Step 1 involves starting a business to sell utility services like gas, electric, and phone to customers while getting those same services at a discount. Step 2 allows writing off business expenses on taxes. Step 3 uses savings from steps 1-2 to start an investment program. Step 4 optimizes assets to further increase savings. It claims the program can turn monthly expenses into monthly income and help money chase the consumer instead.
A merchandising business buys and sells goods to make a profit. The goods purchased for resale are called merchandise. There are two main systems for tracking inventory - perpetual and periodic. The perpetual system tracks inventory in real time with each purchase or sale, while the periodic system only calculates cost of goods sold at the end of each period based on a physical inventory count. Calculating cost of goods sold is important for measuring income for merchandising businesses.
Active Gear, Inc is considering acquiring Mercury Athletic to double its revenue and expand its market presence. John Liedtke analyzed Mercury's financials from 2006-2011 to determine if the acquisition would be financially beneficial. The net present value of Mercury's projected free cash flows is $275,399.78 using a 7.65% discount rate, indicating the acquisition would provide a positive return on investment. Liedtke also considered qualitative benefits like increased market share and preventing competitors from acquiring Mercury. Based on the financial analysis, the acquisition appears justified and would create value for Active Gear.
Active Gear, Inc is considering acquiring Mercury Athletic to double its revenue and expand its market presence. John Liedtke analyzed Mercury's financials from 2006-2011 and calculated the net present value (NPV) using a 7.65% discount rate. The NPV of $275,399.78 exceeds the proposed $186,215.80 acquisition price, indicating the purchase would generate positive returns. Lowering the discount rate to 6.3% increases the NPV further, but raising it to 15% decreases the NPV to account for additional risk. The analysis supports acquiring Mercury as financially beneficial for Active Gear.
Successful Cash Management For Your Businessrfarnum
This document discusses keys to successful cash flow management for businesses. It covers understanding cash flow and working capital, maximizing cash flow by managing accounts receivable and payable, and tips and tools for implementing a cash flow management strategy including depository and credit card services. The presentation aims to provide businesses with information and strategies for monitoring and improving cash flow through metrics like current ratio and inventory and receivables turnover. It also offers advice for managing cash flow crises by adjusting cash inflows and outflows.
The document provides an overview of key concepts in accounting for plant assets, natural resources, and intangible assets from Chapter 8, including determining the cost of plant assets, depreciation methods, revising periodic depreciation, accounting for natural resources, intangible assets, exchanging plant assets, and calculating the asset turnover ratio. It includes examples and exercises for each concept with step-by-step solutions.
The document contains review questions and scenarios relating to recording business transactions using accrual accounting. It includes:
1) A table to complete showing the accounting equation for various entities.
2) Scenarios to determine which are business transactions, including purchasing stock on credit, paying electricity bills, and withdrawing assets for personal use.
3) Worksheet examples recording business transactions for entities over a month period, including calculating profit and loss.
The documents provide financial information for a company, including a trial balance, trading and profit & loss account, and balance sheet.
The trial balance lists the company's income, expenses, assets and liabilities to ensure debits equal credits. The trading account shows how gross profit is generated. The profit & loss account lists expenses to determine if there was a net profit. The balance sheet reports the company's assets, liabilities, and capital at a point in time to ensure assets equal the sum of liabilities and capital.
Ms G's Guide to the Restaurant Income StatementMGionti
The document shows the statement of income for the Stowe Room Café for the month ending October 31. Total sales were $426,023 with food sales accounting for 76.44% ($325,658) and beverage sales 23.56% ($100,365). Total cost of goods sold was 34% ($144,826) of total sales. Operating expenses accounted for 47.21% ($201,137) of total sales. After taxes, the net income was 4.47% ($19,023) of total sales.
This document contains an assignment submitted by Akershit Kumar Sharma to Professor Mushtaq Ahmed on April 7, 2013. It includes answers to various questions related to contribution format income statements segmented by territory and product line. The key details provided are contribution format income statements for a company's total sales, segmented by the northern and southern territories, and further segmented of the northern territory by its Paks and Tibs product lines. Analysis is also provided on performance of different territories and product lines.
This document contains 9 problems related to leverage analysis for various companies. The problems include calculating degrees of operating, financial, and combined leverage given income statements and capital structures. They also involve computing earnings per share under different financing scenarios and levels of earnings before interest and taxes.
This document contains examples of correcting entries for accounting errors. The first error was a collection that was incorrectly recorded as a debit to cash and credit to service revenue, when it should have been a debit to accounts receivable and credit to service revenue. The second error was a purchase of supplies that was incorrectly recorded as a debit to supplies and credit to accounts payable for the wrong amount. The document provides the incorrect entry, correct entry, and correcting entry for each error.
1) The document discusses steps in preparing a worksheet and completing the accounting cycle including closing entries.
2) It provides examples of adjusting entries, closing entries, and a classified balance sheet.
3) The objectives are to understand worksheet preparation, closing books, correcting entries, and the classified balance sheet.
Based on the information provided:
- Short-term rates increased to 11%
- Long-term rates remain at 13%
- Temporary current assets remain at $1,000,000
- Permanent current assets remain at $2,000,000
- Fixed assets remain at $1,200,000
- Earnings before interest and taxes remain at $996,000
- Tax rate remains at 40%
With the new short-term rate of 11%, short-term interest expense would be:
Temporary current assets of $1,000,000 at 11% = $110,000
Long-term interest expense and the calculation of earnings after taxes remains the same.
Therefore
Silver Construction Ltd recognizes gross profit of P80,000 in 2013 and P120,000 in 2014 using the percentage-of-completion method based on costs incurred. GPC Ltd recognizes gross profit of P150,000 in 2009 on contract #3814 using the percentage-of-completion method based on costs incurred and estimated costs to complete. Masikap Construction Co recognizes gross profit of P600,000 in 2010 and P840,000 in 2011 on a fixed-price construction contract using the percentage-of-completion method based on percentage of completion and estimated total costs.
The document discusses adjusting entries for accounting transactions. It provides examples of adjusting entries for depreciation, supplies, prepaid rent, and unearned revenue. It also calculates book value of equipment and the adjusting entry needed for earned revenue that was initially recorded as unearned. Exercises are included for students to practice preparing adjusting entries.
Whole Foods Market reported sales of $6.16 billion for fiscal year 2008 with gross profit of $2.11 billion. Operating income was $213.7 million. Net income for the year was $113 million, or $0.81 per diluted share. The company paid dividends of $0.60 per share for the year.
A trial balance is a list of all ledger account balances on a given date arranged in separate debit and credit columns. It is prepared to test arithmetic accuracy, help prepare financial statements, locate errors, allow comparison, and make adjustments. However, a trial balance does not conclusively prove accuracy as some errors like omissions, original errors, errors of principle, or compensating errors may not be disclosed. The example shows a trial balance prepared from account balances extracted from Mohan Kumar's books on March 31, 2010 with equal totals for debit and credit columns.
This document discusses capital budgeting and risk analysis. It covers the following key points:
1. It discusses different types of project analysis including expansion, replacement, mandatory, safety/regulatory projects.
2. It outlines steps for cash flow analysis including identifying relevant incremental cash flows, developing pro forma financial statements and project cash flows, and considering special cases.
3. It discusses risk analysis tools for capital budgeting including sensitivity analysis, scenario analysis, and simulation analysis to examine the impact of risk on project outcomes.
This document provides information for an intermediate accounting exam including 4 problems related to financial statements, receivables, inventories, and accounting principles. Problem 1 asks students to prepare a statement of financial position. Problem 2 asks students to prepare a comprehensive income statement. Problem 3 involves calculating impairment of receivables. Problem 4 involves inventory costing methods and valuation. Problem 5 asks students to identify violations of accounting assumptions, principles, or constraints for various accounting practices.
Wilkins Kennedy - Business Recovery: Early signs a business is in financial t...misssarahj
Presentation by UK top 20 accountancy firm Wilkins Kennedy, October 2012. How to spot the early warning signs that a business is in financial trouble and the options available to improve the situation.
- Torentino Book Warehouse had various book purchase and sale transactions throughout June under a perpetual inventory system. Transactions included purchases of books from publishers on account, sales of books to retailers on account, returns of books to publishers, payments to publishers, and receipts of payments from retailers.
- Tool Time Hardware Store had various merchandise purchase and sale transactions throughout May. Transactions included purchases and sales of merchandise on account and for cash, returns and allowances, payments to suppliers, and the purchase of supplies.
- Duff Department Store's trial balance at the end of November showed various expense, revenue, asset and liability accounts. Adjusting entries were needed for depreciation, prepaid insurance, and sales commissions. Closing
The document discusses a 4-step program to help consumers save money and generate income by starting their own utilities brokerage business. Step 1 involves starting a business to sell utility services like gas, electric, and phone to customers while getting those same services at a discount. Step 2 allows writing off business expenses on taxes. Step 3 uses savings from steps 1-2 to start an investment program. Step 4 optimizes assets to further increase savings. It claims the program can turn monthly expenses into monthly income and help money chase the consumer instead.
A merchandising business buys and sells goods to make a profit. The goods purchased for resale are called merchandise. There are two main systems for tracking inventory - perpetual and periodic. The perpetual system tracks inventory in real time with each purchase or sale, while the periodic system only calculates cost of goods sold at the end of each period based on a physical inventory count. Calculating cost of goods sold is important for measuring income for merchandising businesses.
Active Gear, Inc is considering acquiring Mercury Athletic to double its revenue and expand its market presence. John Liedtke analyzed Mercury's financials from 2006-2011 to determine if the acquisition would be financially beneficial. The net present value of Mercury's projected free cash flows is $275,399.78 using a 7.65% discount rate, indicating the acquisition would provide a positive return on investment. Liedtke also considered qualitative benefits like increased market share and preventing competitors from acquiring Mercury. Based on the financial analysis, the acquisition appears justified and would create value for Active Gear.
Active Gear, Inc is considering acquiring Mercury Athletic to double its revenue and expand its market presence. John Liedtke analyzed Mercury's financials from 2006-2011 and calculated the net present value (NPV) using a 7.65% discount rate. The NPV of $275,399.78 exceeds the proposed $186,215.80 acquisition price, indicating the purchase would generate positive returns. Lowering the discount rate to 6.3% increases the NPV further, but raising it to 15% decreases the NPV to account for additional risk. The analysis supports acquiring Mercury as financially beneficial for Active Gear.
1) Active Gear Inc. is considering acquiring Mercury Athletic, a footwear company being sold by its parent company, to double its revenue and expand its market presence.
2) An analysis of Mercury's financial data from 2006-2011 shows that it has higher revenue growth than AGI and its acquisition could help compensate for weaknesses in AGI's product mix.
3) Calculating Mercury's discounted cash flows from 2006-2011 using a 7.65% discount rate results in a positive NPV of $275,399.78 for the acquisition, indicating it should be undertaken.
The document provides key financial ratios for Larsen and Toubro for the years March 2011 through March 2007. Some of the key metrics included are net profit margin, return on equity, current ratio, debt to equity ratio, inventory turnover ratio, and earnings per share. The ratios measure profitability, liquidity, leverage, efficiency, and valuation. Overall the document analyzes the company's financial performance and position over several years.
This document provides forward-looking statements and non-GAAP financial information for Monsanto's investor day on November 10, 2005. It includes reconciliations of free cash flow, non-GAAP EPS, and return on capital for fiscal years 2004-2007. The document also notes that references to fiscal years refer to Monsanto's year ending August 31 and lists several of Monsanto's trademarks.
Cummins Inc. defines EBIT as earnings before interest expense, income taxes, and minority interests in consolidated subsidiaries. EBIT is used to assess performance of operating segments and in measuring compensation programs. EBIT for the three months ended June 2005 was $235 million, or 9.4% of net sales, compared to $148 million, or 7.0% of net sales for the same period in 2004. For the six months ended June 2005, EBIT was $398 million, or 8.5% of net sales, compared to $226 million, or 5.8% of net sales for the same period in 2004. While not a GAAP measure, Cummins believes EBIT illustrates operating performance without regard
Cummins Inc. defines EBIT as earnings before interest expense, income taxes, and minority interests in consolidated subsidiaries. EBIT is used to assess performance of operating segments and in measuring compensation programs. EBIT for the three months ended June 2005 was $235 million, or 9.4% of net sales, compared to $148 million, or 7.0% of net sales for the same period in 2004. For the six months ended June 2005, EBIT was $398 million, or 8.5% of net sales, versus $226 million, or 5.8% of net sales in 2004. While not a GAAP measure, Cummins believes EBIT illustrates operating performance without regard to financing methods, capital
The document provides recommendations for processes that can help an organization reduce costs. It recommends identifying areas for cost savings, quantifying potential savings, testing cost reduction processes before implementing, and ensuring cost reductions are achieved. Specific techniques mentioned include long-term supplier contracts for favorable pricing, using multiple suppliers to reduce costs, minimizing waste through advanced technology, and offering discounts to customers who pay on time to reduce financing costs.
This document discusses fundamental value and how to measure it using discounted cash flow (DCF) analysis. It provides an example of valuing a hypothetical carpentry business. Key points include:
- Fundamental value is determined by measuring a business's expected future cash flows and discounting them back to the present.
- DCF analysis involves forecasting cash flows, applying a discount rate to account for risk and the time value of money, and including a terminal value to estimate value beyond the explicit forecast period.
- Applying DCF to the carpentry business yields a fundamental value estimate of £138,630 based on its projected cash flows through 2025 and a terminal value.
Itaú corretora meeting with buy-side analysts on accounting for the sector ...Gafisa RI !
The document discusses key accounting practices used by Gafisa, a Brazilian real estate company. It explains that Gafisa uses the percentage of completion method to recognize revenues over time as construction progresses. It also uses special purpose entities (SPEs) for real estate investments to address third party interests, construction financing requirements, and tax/accounting matters. The legal structure involves Gafisa holding ownership stakes in multiple SPEs, which in turn hold ownership positions in joint venture projects with other real estate developers.
The document provides a basic primer on understanding financial statements for beginners. It explains the two key financial statements - the balance sheet and income statement. The balance sheet reflects a company's financial makeup and standing at a point in time, showing assets, liabilities, and net worth. The income statement reflects revenues and expenses for the current year to show net profit or loss. Net profit on the income statement flows to net worth on the balance sheet.
Danaher Corporation provided a document summarizing its selling, general and administrative costs, operating profit, and free cash flow for the quarter and year ended December 31, 2003. Some key highlights include:
- Total company revenue for the quarter increased 16.7% to $1.49 billion compared to the same quarter last year.
- Operating profit before special credits for the total company was $239.6 million for the quarter, up 20.1% from the prior year.
- Free cash flow for the year was $781.2 million, up 21.1% from 2002.
This document provides information to prepare final accounts with adjustments for Ravinder, including:
1. The Trial Balance is given for Ravinder with various account balances.
2. Additional adjustments are provided, including manager's commission calculated as 10% of net profits before commission.
3. Interest on a 12% loan taken on July 1, 1987 is to be calculated and any outstanding amount adjusted.
4. Goods worth Rs. 1,500 taken by the proprietor for personal use requires an adjustment.
The student is to prepare the Trading and Profit & Loss Account, Balance Sheet, and make the necessary adjustments based on the Trial Balance and additional information given.
The document discusses various analytical techniques used for financial statement analysis including horizontal analysis, trend analysis, common size statements, and ratios. It provides details on liquidity ratios like current ratio and quick ratio, turnover ratios like inventory and debtors turnover, and profitability/performance ratios like gross profit margin, net profit margin, return on investment, and return on equity. The document also contains an example calculating the debt service coverage ratio for a company over multiple years to assess its debt repayment ability.
The document analyzes the financial performance of a project over 15 years. It shows the investment cost, capital expenditures, replacement costs, working costs, gross income, net income, and discount factors on an annual basis. The net present value of the project is calculated to be Rs. 9,38,897 with a benefit-cost ratio of 1:1.79, indicating the project is financially viable. The internal rate of return is also calculated but not disclosed.
Microsoft Power Point Report To Client Template April 2008phjordan
- ABC Inc. has experienced a rapid downturn in sales and missed financing covenants for the first time, putting pressure on its finances. An analysis was conducted to recommend improvements.
- Key issues identified include rapidly declining sales, high accounts receivable balances due to slower payments, and increasing returns negatively impacting cash flow.
- The analysis found that fixed costs grew faster than sales in recent years, decreasing profits. Cost-cutting measures were implemented but may need to be expanded if sales continue declining.
- Ameriprise Financial reported adjusted earnings per share of $0.91 for the first quarter of 2007, a 21% increase from the first quarter of 2006.
- Total revenue increased 6% compared to the prior year quarter to $2.06 billion.
- Owned, managed and administered assets increased 6% year-over-year to $473.9 billion as of the end of the first quarter of 2007.
The document discusses several capital budgeting techniques for evaluating investments with unequal lives, including the equivalent annual cost method. It explains that this method allows comparison of projects with different lifetimes by calculating the constant annual cost of each option over their full lifetimes, so that the alternatives become comparable on an annual basis. The method involves repeating short-term projects to create a continuous chain that matches the longest-lived option, then computing the net present value of the chain to evaluate which has the lowest equivalent annual cost.
Budgeting basics ii the gearwheels of your budgetJan Bendtsen
The document discusses budgeting for new businesses. It argues that budgets should not be seen as predictions, but as simulations or goals. The rest of the document provides examples of how to build budgets through establishing formulas based on key assumptions and variables, such as hourly rates, marketing efforts, sales targets, production capacity, and seasonal fluctuations. Formulas are provided for a web shop, consulting business, innovative product, and car wash as examples. The goal is to break budgets down into logical steps and components to make the process more manageable.
This document discusses various legal structures for startups including sole proprietorships, partnerships, limited liability companies (LLCs), and corporations. It notes the pros and cons of each in terms of personal risk, costs, formalities, and ease of setup and sale. The document also briefly discusses holding company structures, registration requirements in Denmark which only requires filling out a simple form, authorization requirements for certain businesses, the importance of founders agreements to define roles and prevent future conflicts, and some key Danish employment laws and paperwork requirements for employers.
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The business plan outlines the key sections needed to successfully communicate an idea for a new business venture. It includes an executive summary, product description, market analysis, organizational details, financial projections, and appendices. The executive summary provides a 1-2 page overview of the full business plan. The core sections then describe the problem and solution, product or service details, target customer and market size, competitive landscape, sales and marketing strategies, management team, milestones, and associated budgets and assumptions.
A European study identified seven types of entrepreneurs: the mountaineer who takes risks and seeks challenges; the playing child who finds work pleasurable and combines work and hobbies; the successor who inherits a company and feels a duty to customers and networks; the idealist who wants to make a positive impact on society; the businessman focused on profit above all else; the globalist who seeks international opportunities; and the survivor who was driven to entrepreneurship by need rather than desire for challenges.
The document outlines strategies for building a product portfolio and sales funnel. It discusses introducing prospects to products through reduced and trial versions to turn them into users. The core discusses core products that are the basis of the business. Add-ons enhance core products to allow for additional sales. Packages bundle core and add-on products at a discount to encourage purchasing multiple items. Premium products showcase top offerings and status but may not sell in large volumes. The overall strategies aim to progress customers through the sales funnel from prospects to lasting relationships.
The document outlines a potential partner pitch that includes sections on the organization, the customer problem being solved, the proposed solution and how a partnership could enhance it. It describes how the partnership would work, the underlying technology, a demonstration, competition if applicable, the management team, and next steps such as a trial period. The overall aim is to convince a potential partner to collaborate by explaining how the partnership could alleviate customer pain better than either could alone.
The document outlines a 10 slide sales pitch that describes the customer pain being alleviated, explains how the solution alleviates this pain without being too technical, ensures the audience understands the sales model, describes the technology in a non-technical way, includes a demo to show not just tell, provides a competitive analysis addressing problems with competitors' solutions, describes the management team and board, and ends with a call to action for the next step.
The document discusses different types of partnerships that companies can form, including common resource partnerships, purchasing partnerships, marketing partnerships, consortiums, joint ventures, and strategic alliances. These partnerships allow companies to reduce costs, utilize resources more efficiently, attain better prices through bulk purchasing, strengthen marketing efforts at lower costs, present more attractive supplier packages through collaboration, create new opportunities by combining skills and technologies, and gain competitive advantages over other competitors. However, companies should consider whether partnerships provide mutual benefits and what capabilities they may give up when partnering with others.
This document discusses different legal structures for company ownership including sole proprietorships, partnerships, and limited liability companies. It notes the personal risks, capital requirements, regulations, and other factors to consider with each structure. It also covers setting up a holding structure, registering a business, authorization requirements, drafting founders/partnership agreements, and key rights and regulations regarding employees.
There are several sources of financing available for businesses at different stages of growth, including equity financing through sources like seed funds, business angels, and venture capital funds, as well as loan financing from banks. Equity financing provides ownership in exchange for risk, while loans require interest payments and repayment but provide no ownership. Public sector financing through grants can also be an option. The type of financing needed depends on the business lifecycle stage, from R&D funding through seed capital and grants, to startup financing from angels and venture capital seeking high growth potential, to exploitation and growth funding from banks, angels, and venture capital.
This document discusses how entrepreneurs can establish relationships and agreements with business angels when seeking investment. It notes there are two types of business angels: those who like to negotiate terms of deals and those who don't. For those who negotiate, the document outlines important questions entrepreneurs and business angels should consider, such as how the company will be evaluated, what guarantees can be provided about future investments, what value the business angel can add, and how exit opportunities may occur.
The document summarizes the characteristics of a business angel, who is an important financial source for entrepreneurs. Business angels typically have high net worth and invest their own money directly in unquoted companies. They provide time, expertise, strategic advice, and networking opportunities in addition to financial support. Their goal is financial gain by supporting startups and helping them achieve exit opportunities within 3-7 years.
The document outlines the 7 key steps in an innovative venture creation process: 1) Idea, 2) Preseed, 3) Seed, 4) Startup, 5) Initial Growth, 6) Expansion, and 7) Restructuring. Each step involves certain activities like prototyping, fundraising, hiring, and product development. Gates or stagegates are reached at the end of each step to evaluate commercial potential and organizational readiness before advancing to the next phase.
There are several sources of financing available for businesses at different stages of growth, including equity financing through sources like seed funds, business angels, and venture capital funds, as well as loan financing from banks. Equity financing provides ownership in exchange for risk, while loans require interest payments and repayment but provide no ownership. Public sector financing through grants can also be an option. The type of financing needed depends on the business lifecycle stage, with seed capital and public grants used for R&D, business angels and venture capital for startups, and bank loans and equity funds for later stage growth.
The document provides guidance for a 10 slide, 20 minute investor pitch that follows the 10/20/30 rule. It outlines the key sections to include: problem, solution, business model, underlying magic, marketing/sales, competition, management team, financials/metrics, and current status. The pitch should clearly explain the problem being solved, solution, business model, team, and use of funds while visualizing concepts and showing traction.
OJP data from firms like Vicinity Jobs have emerged as a complement to traditional sources of labour demand data, such as the Job Vacancy and Wages Survey (JVWS). Ibrahim Abuallail, PhD Candidate, University of Ottawa, presented research relating to bias in OJPs and a proposed approach to effectively adjust OJP data to complement existing official data (such as from the JVWS) and improve the measurement of labour demand.
Fabular Frames and the Four Ratio ProblemMajid Iqbal
Digital, interactive art showing the struggle of a society in providing for its present population while also saving planetary resources for future generations. Spread across several frames, the art is actually the rendering of real and speculative data. The stereographic projections change shape in response to prompts and provocations. Visitors interact with the model through speculative statements about how to increase savings across communities, regions, ecosystems and environments. Their fabulations combined with random noise, i.e. factors beyond control, have a dramatic effect on the societal transition. Things get better. Things get worse. The aim is to give visitors a new grasp and feel of the ongoing struggles in democracies around the world.
Stunning art in the small multiples format brings out the spatiotemporal nature of societal transitions, against backdrop issues such as energy, housing, waste, farmland and forest. In each frame we see hopeful and frightful interplays between spending and saving. Problems emerge when one of the two parts of the existential anaglyph rapidly shrinks like Arctic ice, as factors cross thresholds. Ecological wealth and intergenerational equity areFour at stake. Not enough spending could mean economic stress, social unrest and political conflict. Not enough saving and there will be climate breakdown and ‘bankruptcy’. So where does speculative design start and the gambling and betting end? Behind each fabular frame is a four ratio problem. Each ratio reflects the level of sacrifice and self-restraint a society is willing to accept, against promises of prosperity and freedom. Some values seem to stabilise a frame while others cause collapse. Get the ratios right and we can have it all. Get them wrong and things get more desperate.
Independent Study - College of Wooster Research (2023-2024) FDI, Culture, Glo...AntoniaOwensDetwiler
"Does Foreign Direct Investment Negatively Affect Preservation of Culture in the Global South? Case Studies in Thailand and Cambodia."
Do elements of globalization, such as Foreign Direct Investment (FDI), negatively affect the ability of countries in the Global South to preserve their culture? This research aims to answer this question by employing a cross-sectional comparative case study analysis utilizing methods of difference. Thailand and Cambodia are compared as they are in the same region and have a similar culture. The metric of difference between Thailand and Cambodia is their ability to preserve their culture. This ability is operationalized by their respective attitudes towards FDI; Thailand imposes stringent regulations and limitations on FDI while Cambodia does not hesitate to accept most FDI and imposes fewer limitations. The evidence from this study suggests that FDI from globally influential countries with high gross domestic products (GDPs) (e.g. China, U.S.) challenges the ability of countries with lower GDPs (e.g. Cambodia) to protect their culture. Furthermore, the ability, or lack thereof, of the receiving countries to protect their culture is amplified by the existence and implementation of restrictive FDI policies imposed by their governments.
My study abroad in Bali, Indonesia, inspired this research topic as I noticed how globalization is changing the culture of its people. I learned their language and way of life which helped me understand the beauty and importance of cultural preservation. I believe we could all benefit from learning new perspectives as they could help us ideate solutions to contemporary issues and empathize with others.
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Vicinity Jobs’ data includes more than three million 2023 OJPs and thousands of skills. Most skills appear in less than 0.02% of job postings, so most postings rely on a small subset of commonly used terms, like teamwork.
Laura Adkins-Hackett, Economist, LMIC, and Sukriti Trehan, Data Scientist, LMIC, presented their research exploring trends in the skills listed in OJPs to develop a deeper understanding of in-demand skills. This research project uses pointwise mutual information and other methods to extract more information about common skills from the relationships between skills, occupations and regions.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
New Visa Rules for Tourists and Students in Thailand | Amit Kakkar Easy VisaAmit Kakkar
Discover essential details about Thailand's recent visa policy changes, tailored for tourists and students. Amit Kakkar Easy Visa provides a comprehensive overview of new requirements, application processes, and tips to ensure a smooth transition for all travelers.
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May’s reports showed signs of continued economic growth, said Sam Millette, director, fixed income, in his latest Economic Risk Factor Update.
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2. 2 | Budgeting Basics
Introduction
Figuring out your establishing budget and your
operating budget might involve a good deal of work
and estimating your sales will probably involve
some frustrations too – especially if you see it as an
impossible attempt to predict.
However, the cashflow budget is where you must
be really concentrated. The challenge in you
cashflow budget is to place all your payments in the
month where the money will go either in on or out
of your account.
The purpose is to find out if we need more money
than the startup investment that we found out in
our establishing budget.
The cashflow budget is basically your operating
budget transformed into actual cashflow. If you
deliver a product or service in September, you will register the turnover of that transaction in September in
your operating budget. If however you send the invoice at the end of September and receive the money in
October, you should register the payment from the customer in October.
Furthermore there are some payments, that you cannot find in your operating budget but that will have to
be in your cashflow budget.
I will introduce you gradually to the different complexities of the cashflow budget in the following.
As an example I will show you an operating budget, that I will transform into a cashflow budget.
4. 4 | Klik her for at angive tekst.
The very basics
The very basics of a cashflow budget go like this:
Cash, beginning of month
+ Incoming payments
- Outgoing payments
= Cash, end of month
So in the simple cashflow budget you just take the numbers from the operating budget and
transfer them to a cashflow budget. Except for the depreciation which is not actually a
payment!
I have made the calculations for the first four months below:
1.000 DKK September October November December
Cash, beginning of month 0 27.3 54.6 81.9
Incoming payments
Sales 250 250 300 400
Outgoing payments
Variable costs 185 185 240 300
Fixed costs 37.7 37.7 32.7 72.7
Cash, end of month 27.3 54.6 81.9 254.6
The conclusion:
We do not need the bank for funding. We expect to earn a profit from the first month and will
have positive cashflow (more incoming than outgoing payments) all the way. After the first
month we have 27.300 DKK in the bank and that amount just grows and grows.
5. 5 | Klik her for at angive tekst.
The extra payments – and the non-
payments
It would be nice if it was actually that simple, but it is not quite. There are actually some
payments, that you cannot see in the operating budget or income statement – and then there
is something in the operating budget, that is not actually a cash payment.
The payments that you cannot see in an operating budget will typically be the following:
Private withdrawals
Investments in large assets - that cost more than app. 12.000 DKK.
Repayment on loans
Deposits
And the cost in your operating budget, that is actually not a cash payment:
Depreciation
If we assume that we take out private withdrawals of 20.000 DKK pr. month, pay a 50.000 DKK
deposit on the rent in the first month and expect to invest 30.000 in new shop interior before
Christmas, our cashflow will actually look like this:
September October November December
Cash, beginning of month 0 -42,7 -35,4 -58,1
Incoming payments
Sales 250 250 300 400
Total incoming payments 250 250 300 400
Outgoing payments
Variable costs 185 185 240 300
Fixed costs 37,7 37,7 32,7 72,7
Private withdrawals 20 20 20 20
Deposit on rent 50
Shop interior 30
Total outgoing payments 292,7 242,7 322,7 392,7
6. 6 | Klik her for at angive tekst.
Cash, end of month -42,7 -35,4 -58,1 -50,8
The conclusion
Since we need private withdrawals to survive personally and since we need to pay deposit and
invest in new interior before the booming Christmas sales, we will need a cash credit of at least
58.100 DKK to cover the overdraft in November (In practice you would probably want to ask
for 70-80.000 or more to have a margin).
7. 7 | Klik her for at angive tekst.
Delayed payments – complicating
things further
We have now learned that there are actually payments, that we cannot find in the operating
budget, and to complicate things further, we will have to take time of payment into
consideration.
When you start a job as an employee, it will make a big difference to you if you get your
monthly wage on the 1st of a month instead of the 31st. If you get you wage at the end of the
month, you will have no cash for a month. The same goes for businesses, so you will have to
take into consideration:
- When will I actually have to pay for what I buy?
- When can I get my money from my customers?
Let’s make a couple of assumption about the budget above:
- We assume that we get our money in cash when people buy in the shop, but only after 30
days when we deliver to business customers.
- We assume that 40% of our sales are to business customers, so we only get our money
after 30 days on half of our sales.
- We assume that we have to pay our suppliers on delivery and also pay our other costs
immediately – just to simplify things a bit.
September October November December
Cash, primo 0 -142,7 -135,4 -178,1
Incoming payments
Cash sales 150 150 180 240
Credit sales - 30 days 100 100 120
Total incoming payments 150 250 280 360
Outgoing payments
Variable costs 185 185 240 300
Fixed costs 37,7 37,7 32,7 72,7
Private withdrawals 20 20 20 20
Deposit on rent 50
Shop interior 30
Total outgoing payments 292,7 242,7 322,7 392,7
Cash, ultimo -142,7 -135,4 -178,1 -210,8
8. 8 | Klik her for at angive tekst.
In September you expect to sell for 250.000 DKK, but if 40% of your sales – 100.000 DKK – are
on credit, you will only get the money in October. In September you will only receive the
150.000 DKK from your 60% cash sales.
The conclusion
Since we accepted, that our business customers – 40% of our sales – only pay after 30 days, we
will need further credit to fund that. Instead of 58.100 DKK we will need a cash credit of at
least 210.800 DKK.
The reason for that is that we will have to pay our suppliers before we get all our money from
our customers. Credit from our suppliers would solve part of the problem.
We will be profitable every month, but we will just not have got the money yet. It’s like getting
your wage or student grants at the end of the month instead of the beginning of the month.
This is what it will look like if you fx organize an event and get paid after the event. You will
need money to cover the costs until your customer pays you.
9. 9 | Klik her for at angive tekst.
VAT – the tricky part
To take the complexity one step further, we want to take VAT into consideration.
However! If you have a concept, where you don’t have to charge VAT – fx certain cultural and
social offers – you can skip this part!!!!
If you have to add VAT to your prices – which most commercial products or services do – you
will make the operating budget without VAT but include the VAT in your cashflow budget.
The rationale for that is that VAT you charge is not something you can keep, and the VAT you
pay you can get refunded. Therefore it is not actually income or cost to you and should not be
in the operating budget. However, the money goes in and out of your bank account, so they
should be registered as cashflow anyhow. Below I have added 25% VAT to costs and sales in
the cashflow budget. No VAT on the private withdrawals however.
September October November December
Cash, primo
0 -105,2 -35,4 -8,1
Incoming payments
Cash sales 150 150 180 240
Credit sales - 30 days
100 100 120
VAT on sales - 25%
37,5 62,5 70 90
Total incoming payments
187,5 312,5 350 450
Outgoing payments
Variable costs
185 185 240 300
Fixed costs
37,7 37,7 32,7 72,7
Private withdrawals 20 20 20 20
Deposit on rent 50
Shop interior 30
VAT on costs 25% 56 56 76 93
Total outgoing payments 292,7 242,7 322,7 392,7
Cash, ultimo -105,2 -35,4 -8,1 49,2
10. 10 | Klik her for at angive tekst.
The conclusion:
VAT is a good thing for your cashflow. You charge VAT and pay later. In this case it means that
you will only need 105.200 DKK in funding in the beginning and pay it back fast. By Christmas
you bank account will be positive.
Just remember, that every three months you have to pay back the net VAT you charged.
If we take the first three months in this case:
VAT on sales 25% of (250+250+300)- see operating budget 200.000
VAT on costs 25% of (185+185+240+37,7+37,7+32,7) 179.525
Net VAT 20.475
This means that 20.475 must be refunded to the tax authorities. In practice in DK it will be
done 4 times a year.
Now you probably understand why we have accountants
But I hope it gave you an understanding of how dynamics are in a budget.