A few years ago I was embarrassed by getting this wrong. Asset Management can be confusing because some values are in current dollars and others in future dollars.
The document discusses the concepts of realized return, expected return, risk, and the efficient market hypothesis. It provides examples of calculating realized returns from investments in stocks and defines expected return as the average of possible future returns weighted by their probabilities. Risk is measured using variance and standard deviation, with higher values indicating greater risk. The efficient market hypothesis suggests that market prices reflect all available information.
Chapter7 an introduction to risk and returnRodel Falculan
This chapter discusses risk and return in financial markets. It defines realized and expected rates of return as well as risk. Historically, riskier investments like small stocks have achieved higher average returns than less risky investments like government bonds, but also experienced greater price fluctuations. The chapter compares arithmetic and geometric average returns and explains why the geometric average best measures the compound growth rate. The efficient market hypothesis posits that market prices instantly reflect all available information.
Discussion paper series iteration or circularity in wacc calculationFuturum2
This email exchange discusses issues with circularity that can arise when calculating the weighted average cost of capital (WACC). Specifically, the weights used to calculate the WACC may differ from the actual debt-to-equity ratio of the company being valued. The discussion focuses on two approaches to address this issue. The first is to set target debt levels in projections so the debt-to-value ratio remains constant. The second is to iterate the calculations, recalculating the WACC based on estimated values until the weights converge. The exchange also notes one should not expect projected debt ratios to exactly match target weights, but they should remain reasonably close.
USING FINANCIAL STATEMENTS INFORMATIONDoulat panah
This document discusses financial statement analysis and the time value of money. It covers:
- Reasons for analyzing financial statements like performance evaluation and checking projections.
- Benchmarking methods like comparing to peers or historical trends.
- Calculating future value over time using compound interest formulas for single deposits or regular cash flows.
- How present value considers the time value of money by discounting future cash flows.
The document discusses the author's analysis of various stock portfolios from February 2015 to December 2015. For each month, the author calculates an equal weighted portfolio, global minimum variance portfolio, targeted return portfolio, and tangency portfolio using stock data from Apple, Exxon Mobil, Microsoft, and Alphabet. The author then analyzes the expected returns and risks of each portfolio to determine which would provide the highest utility for a risk-seeking investor. The optimal portfolio choice depends on the monthly returns and whether a tangency portfolio can be computed given the risk-free rate.
This document discusses the earnings multiplier model for estimating the value of common stocks. [1] It states that the value of any investment is the present value of future returns, and for stocks the returns are the firm's net earnings. [2] Investors estimate a stock's value by determining how many rupees they are willing to pay for each rupee of expected earnings. [3] Factors like the dividend payout ratio, required rate of return, and expected growth rate determine the prevailing price-to-earnings ratio, or earnings multiplier, in the market.
As an owner of Intel stock, you are entitled to a share of the company's earnings. Intel earned $11.5 billion over the last 12 months, which works out to earnings per share (EPS) of $2.34. This allows calculation of Intel's price-to-earnings (P/E) ratio of 14.80, indicating it costs $14.80 to buy $1 of Intel's annual earnings. While owners do not receive direct payments of EPS, they do receive quarterly dividends, which currently yield 2.77% annually. Analysts expect Intel's earnings to grow to $2.22 in the current fiscal year and $2.37 in the next fiscal year.
The document discusses the concepts of realized return, expected return, risk, and the efficient market hypothesis. It provides examples of calculating realized returns from investments in stocks and defines expected return as the average of possible future returns weighted by their probabilities. Risk is measured using variance and standard deviation, with higher values indicating greater risk. The efficient market hypothesis suggests that market prices reflect all available information.
Chapter7 an introduction to risk and returnRodel Falculan
This chapter discusses risk and return in financial markets. It defines realized and expected rates of return as well as risk. Historically, riskier investments like small stocks have achieved higher average returns than less risky investments like government bonds, but also experienced greater price fluctuations. The chapter compares arithmetic and geometric average returns and explains why the geometric average best measures the compound growth rate. The efficient market hypothesis posits that market prices instantly reflect all available information.
Discussion paper series iteration or circularity in wacc calculationFuturum2
This email exchange discusses issues with circularity that can arise when calculating the weighted average cost of capital (WACC). Specifically, the weights used to calculate the WACC may differ from the actual debt-to-equity ratio of the company being valued. The discussion focuses on two approaches to address this issue. The first is to set target debt levels in projections so the debt-to-value ratio remains constant. The second is to iterate the calculations, recalculating the WACC based on estimated values until the weights converge. The exchange also notes one should not expect projected debt ratios to exactly match target weights, but they should remain reasonably close.
USING FINANCIAL STATEMENTS INFORMATIONDoulat panah
This document discusses financial statement analysis and the time value of money. It covers:
- Reasons for analyzing financial statements like performance evaluation and checking projections.
- Benchmarking methods like comparing to peers or historical trends.
- Calculating future value over time using compound interest formulas for single deposits or regular cash flows.
- How present value considers the time value of money by discounting future cash flows.
The document discusses the author's analysis of various stock portfolios from February 2015 to December 2015. For each month, the author calculates an equal weighted portfolio, global minimum variance portfolio, targeted return portfolio, and tangency portfolio using stock data from Apple, Exxon Mobil, Microsoft, and Alphabet. The author then analyzes the expected returns and risks of each portfolio to determine which would provide the highest utility for a risk-seeking investor. The optimal portfolio choice depends on the monthly returns and whether a tangency portfolio can be computed given the risk-free rate.
This document discusses the earnings multiplier model for estimating the value of common stocks. [1] It states that the value of any investment is the present value of future returns, and for stocks the returns are the firm's net earnings. [2] Investors estimate a stock's value by determining how many rupees they are willing to pay for each rupee of expected earnings. [3] Factors like the dividend payout ratio, required rate of return, and expected growth rate determine the prevailing price-to-earnings ratio, or earnings multiplier, in the market.
As an owner of Intel stock, you are entitled to a share of the company's earnings. Intel earned $11.5 billion over the last 12 months, which works out to earnings per share (EPS) of $2.34. This allows calculation of Intel's price-to-earnings (P/E) ratio of 14.80, indicating it costs $14.80 to buy $1 of Intel's annual earnings. While owners do not receive direct payments of EPS, they do receive quarterly dividends, which currently yield 2.77% annually. Analysts expect Intel's earnings to grow to $2.22 in the current fiscal year and $2.37 in the next fiscal year.
This chapter discusses the relationship between risk and return for both individual assets and portfolios of assets. It defines risk as the chance of financial loss and explains that higher risk assets generally provide higher expected returns. The chapter covers measuring the expected return, standard deviation, and coefficient of variation of individual assets. It then explains how forming a portfolio of assets can reduce overall risk through diversification. The chapter discusses how the correlation between asset returns impacts the risk reduction from diversification. It also addresses how adding more assets to a portfolio continues to reduce non-market or unique risk.
Risk And Return Relationship PowerPoint Presentation SlidesSlideTeam
While building a diversified portfolio it is important to balance risk and returns, plan your investment strategy with our content ready easy to understand Risk and Return Relationship PowerPoint Presentation Slides. The visually appealing portfolio risk-return trade-off PowerPoint compete deck includes a set of pre-made PPT slides such as risk and return of stock bonds, and T-bills, investment strategies of predefined portfolios, risk and return of portfolio manager, measuring stock volatility proportionate, portfolio return analysis, calculating asset beta, portfolio value at risk, ranking the passive income streams impact and many more. Discuss the relationship between risk and return using security analysis and portfolio management PPT visuals. Utilize the professionally designed risk-return trade-off to structure your financial presentation. Furthermore, risk and return equation PPT visuals are completely customizable. You can add or delete the content if needed. Download this easy to use security analysis and portfolio management presentation deck to illustrate the risk-return relationship. Halt the growth of cultural differences with our Risk And Return Relationship PowerPoint Presentation Slides. Focus on bringing about acceptance.
This document discusses the cost of capital and its importance in corporate finance. It covers determining the cost of equity, cost of debt, weighted average cost of capital (WACC), and how taxes impact these calculations. The chapter outline includes sections on the cost of equity, costs of debt and preferred stock, WACC, and divisional/project costs of capital. Worked examples are provided for calculating each component of the cost of capital and the overall WACC.
Portfolio Risk And Return Analysis PowerPoint Presentation Slides SlideTeam
Presenting this set of slides with name - Portfolio Risk And Return Analysis Powerpoint Presentation Slides. Enhance your audiences knowledge with this well researched complete deck. Showcase all the important features of the deck with perfect visuals. This deck comprises of total of twenty nine slides with each slide explained in detail. Each template comprises of professional diagrams and layouts. Our professional PowerPoint experts have also included icons, graphs and charts for your convenience. All you have to do is DOWNLOAD the deck. Make changes as per the requirement. Yes, these PPT slides are completely customizable. Edit the colour, text and font size. Add or delete the content from the slide. And leave your audience awestruck with the professionally designed Portfolio Risk And Return Analysis Powerpoint Presentation Slides complete deck.
This document contains a chapter about forecasting financial statements and additional funds needed (AFN). It includes 5 multiple choice questions about key concepts related to forecasting sales, determining asset and liability ratios, calculating sustainable growth rates, and estimating the impact of dividend payout ratios on AFN. The questions assess understanding of using ratios, accounting for excess capacity, and applying the AFN equation to forecast funding requirements.
The document discusses risk and rates of return, including stand-alone risk, portfolio risk, and the Capital Asset Pricing Model. It defines risk as the chance of an unfavorable outcome and discusses how risk is measured using concepts like standard deviation, beta, and the capital market line. Diversification across many assets or asset classes can reduce risk for a portfolio, though not below the market risk.
1) The document discusses risk and return in the context of the Capital Asset Pricing Model (CAPM). It provides examples of how to calculate expected returns, variance, standard deviation, and covariance for individual securities.
2) It then explains how a portfolio's expected return is a weighted average of the individual securities' expected returns. The portfolio's variance depends on the securities' individual variances as well as their covariances.
3) Diversification reduces a portfolio's risk because unsystematic risk can be eliminated through diversification, whereas systematic risk cannot. The market portfolio represents the minimum risk portfolio for a given level of return.
There are three main methods to determine the intrinsic value of a stock:
1) Dividend discount model - The intrinsic value is the present value of all expected future cash flows from the stock.
2) P/E approach - The intrinsic value is calculated using the stock's current or projected price to earnings ratio.
3) Discounted cash flow model - The intrinsic value is the present value of the expected future cash flows discounted at the firm's cost of capital.
Risk and Return Analysis .ppt By Sumon SheikhSumon Sheikh
Risk and return analysis presentation with suitable examples. A perfect class-presentation file.
Prepared by Sumon Sheikh, BBA Student, majoring Accounting and Information Systems at Jatiya Kabi Kazi Nazrul Islam University, Trishal, Mymensingh-2224, Bangladesh.
Measurement of Risk and Calculation of Portfolio RiskDhrumil Shah
This document discusses measuring risk and calculating portfolio risk. It defines risk as the probability of loss and explains that higher investment means higher risk but also higher potential return. It then discusses measuring the risk of individual assets using variance and standard deviation calculated from the asset's probability distribution of returns. The document also explains how to calculate the expected return, variance and standard deviation of a portfolio by taking the weighted average of the individual assets. Diversifying a portfolio can reduce overall risk since the returns on different assets may not move in the same direction.
This document discusses sources of finance including equity share capital, preference share capital, retained earnings, debentures, and institutional loans. It defines leverage as using fixed costs or sources of funds to magnify returns. There are two types of leverage: operating leverage, which is the ability to use fixed operating costs to magnify the effect of sales changes on earnings, and financial leverage, which is the ability to use fixed financial charges to magnify the effect of earnings changes on earnings per share. The combination of operating and financial leverage determines the overall risk level and performance of a company.
Aflac's stock performance has exceeded the S&P 500 since 2005. While future performance cannot be precisely predicted, analysts expect Aflac's earnings to grow to $6.10 in the current fiscal year and $6.42 in the next fiscal year. Aflac pays quarterly dividends to shareholders that represent about 26% of its total earnings, with a current dividend yield of 2.51%. Aflac also buys back its own stock to increase ownership interest for remaining shareholders.
This document contains sample questions and explanations about risk and return concepts such as stand-alone risk, portfolio risk, diversification, and the capital asset pricing model. It provides examples of calculating expected returns, standard deviation of returns, and coefficients of variation for different investments. It also demonstrates how diversification across many randomly selected stocks can significantly reduce stand-alone or idiosyncratic risk while leaving market risk relatively unchanged.
Risk Return Trade Off PowerPoint Presentation SlidesSlideTeam
Presenting this set of slides with name - Risk Return Trade Off Powerpoint Presentation Slides. This deck consists of total of twenty nine slides. It has PPT slides highlighting important topics of Risk Return Trade Off Powerpoint Presentation Slides. This deck comprises of amazing visuals with thoroughly researched content. Each template is well crafted and designed by our PowerPoint experts. Our designers have included all the necessary PowerPoint layouts in this deck. From icons to graphs, this PPT deck has it all. The best part is that these templates are easily customizable. Just click the DOWNLOAD button shown below. Edit the colour, text, font size, add or delete the content as per the requirement. Download this deck now and engage your audience with this ready made presentation.
Basic concepts in decision making (EE&FA/C)Barani Dharan
This document discusses key concepts in engineering economics and financial accounting. It defines opportunity cost as the cost of an alternative that must be forgone to pursue a certain action. The incremental concept refers to changes in output, costs, or incomes. Discounting principles involve converting future cash flows to present value based on a discount factor. The concept of time perspective acknowledges that money received in the future is not worth as much as money received today due to interest earned over time.
The document is a resume for Philip Bryson Lee Ricks providing his contact information, objective, education history, awards, work experience, and availability of references. It shows that Ricks has over 10 years of experience in customer service roles in the food and beverage industry and is currently an order picker and forklift operator at an Amazon fulfillment center seeking an entry level position with room for growth.
This document lists 132 buyers and brands along with their headquarters where Tex Zippers is nominated or approved to supply zippers. It includes major retailers from around the world such as Abercrombie & Fitch, H&M, Gap, JC Penney, Walmart, Zara, and more. Tex Zippers has been approved as a zipper supplier for most of the buyers and brands listed in the document.
This candidate has over 18 years of experience in operations management, project management, and business analysis. They have a proven track record of successfully managing projects involving site migrations, electronic medical record implementations, infrastructure virtualization, and supply chain restructuring. They also have experience developing strategic plans and marketing campaigns that increased revenue and reduced costs. Their skills include project management, process improvement, budgeting, software implementation, and client engagement.
This chapter discusses the relationship between risk and return for both individual assets and portfolios of assets. It defines risk as the chance of financial loss and explains that higher risk assets generally provide higher expected returns. The chapter covers measuring the expected return, standard deviation, and coefficient of variation of individual assets. It then explains how forming a portfolio of assets can reduce overall risk through diversification. The chapter discusses how the correlation between asset returns impacts the risk reduction from diversification. It also addresses how adding more assets to a portfolio continues to reduce non-market or unique risk.
Risk And Return Relationship PowerPoint Presentation SlidesSlideTeam
While building a diversified portfolio it is important to balance risk and returns, plan your investment strategy with our content ready easy to understand Risk and Return Relationship PowerPoint Presentation Slides. The visually appealing portfolio risk-return trade-off PowerPoint compete deck includes a set of pre-made PPT slides such as risk and return of stock bonds, and T-bills, investment strategies of predefined portfolios, risk and return of portfolio manager, measuring stock volatility proportionate, portfolio return analysis, calculating asset beta, portfolio value at risk, ranking the passive income streams impact and many more. Discuss the relationship between risk and return using security analysis and portfolio management PPT visuals. Utilize the professionally designed risk-return trade-off to structure your financial presentation. Furthermore, risk and return equation PPT visuals are completely customizable. You can add or delete the content if needed. Download this easy to use security analysis and portfolio management presentation deck to illustrate the risk-return relationship. Halt the growth of cultural differences with our Risk And Return Relationship PowerPoint Presentation Slides. Focus on bringing about acceptance.
This document discusses the cost of capital and its importance in corporate finance. It covers determining the cost of equity, cost of debt, weighted average cost of capital (WACC), and how taxes impact these calculations. The chapter outline includes sections on the cost of equity, costs of debt and preferred stock, WACC, and divisional/project costs of capital. Worked examples are provided for calculating each component of the cost of capital and the overall WACC.
Portfolio Risk And Return Analysis PowerPoint Presentation Slides SlideTeam
Presenting this set of slides with name - Portfolio Risk And Return Analysis Powerpoint Presentation Slides. Enhance your audiences knowledge with this well researched complete deck. Showcase all the important features of the deck with perfect visuals. This deck comprises of total of twenty nine slides with each slide explained in detail. Each template comprises of professional diagrams and layouts. Our professional PowerPoint experts have also included icons, graphs and charts for your convenience. All you have to do is DOWNLOAD the deck. Make changes as per the requirement. Yes, these PPT slides are completely customizable. Edit the colour, text and font size. Add or delete the content from the slide. And leave your audience awestruck with the professionally designed Portfolio Risk And Return Analysis Powerpoint Presentation Slides complete deck.
This document contains a chapter about forecasting financial statements and additional funds needed (AFN). It includes 5 multiple choice questions about key concepts related to forecasting sales, determining asset and liability ratios, calculating sustainable growth rates, and estimating the impact of dividend payout ratios on AFN. The questions assess understanding of using ratios, accounting for excess capacity, and applying the AFN equation to forecast funding requirements.
The document discusses risk and rates of return, including stand-alone risk, portfolio risk, and the Capital Asset Pricing Model. It defines risk as the chance of an unfavorable outcome and discusses how risk is measured using concepts like standard deviation, beta, and the capital market line. Diversification across many assets or asset classes can reduce risk for a portfolio, though not below the market risk.
1) The document discusses risk and return in the context of the Capital Asset Pricing Model (CAPM). It provides examples of how to calculate expected returns, variance, standard deviation, and covariance for individual securities.
2) It then explains how a portfolio's expected return is a weighted average of the individual securities' expected returns. The portfolio's variance depends on the securities' individual variances as well as their covariances.
3) Diversification reduces a portfolio's risk because unsystematic risk can be eliminated through diversification, whereas systematic risk cannot. The market portfolio represents the minimum risk portfolio for a given level of return.
There are three main methods to determine the intrinsic value of a stock:
1) Dividend discount model - The intrinsic value is the present value of all expected future cash flows from the stock.
2) P/E approach - The intrinsic value is calculated using the stock's current or projected price to earnings ratio.
3) Discounted cash flow model - The intrinsic value is the present value of the expected future cash flows discounted at the firm's cost of capital.
Risk and Return Analysis .ppt By Sumon SheikhSumon Sheikh
Risk and return analysis presentation with suitable examples. A perfect class-presentation file.
Prepared by Sumon Sheikh, BBA Student, majoring Accounting and Information Systems at Jatiya Kabi Kazi Nazrul Islam University, Trishal, Mymensingh-2224, Bangladesh.
Measurement of Risk and Calculation of Portfolio RiskDhrumil Shah
This document discusses measuring risk and calculating portfolio risk. It defines risk as the probability of loss and explains that higher investment means higher risk but also higher potential return. It then discusses measuring the risk of individual assets using variance and standard deviation calculated from the asset's probability distribution of returns. The document also explains how to calculate the expected return, variance and standard deviation of a portfolio by taking the weighted average of the individual assets. Diversifying a portfolio can reduce overall risk since the returns on different assets may not move in the same direction.
This document discusses sources of finance including equity share capital, preference share capital, retained earnings, debentures, and institutional loans. It defines leverage as using fixed costs or sources of funds to magnify returns. There are two types of leverage: operating leverage, which is the ability to use fixed operating costs to magnify the effect of sales changes on earnings, and financial leverage, which is the ability to use fixed financial charges to magnify the effect of earnings changes on earnings per share. The combination of operating and financial leverage determines the overall risk level and performance of a company.
Aflac's stock performance has exceeded the S&P 500 since 2005. While future performance cannot be precisely predicted, analysts expect Aflac's earnings to grow to $6.10 in the current fiscal year and $6.42 in the next fiscal year. Aflac pays quarterly dividends to shareholders that represent about 26% of its total earnings, with a current dividend yield of 2.51%. Aflac also buys back its own stock to increase ownership interest for remaining shareholders.
This document contains sample questions and explanations about risk and return concepts such as stand-alone risk, portfolio risk, diversification, and the capital asset pricing model. It provides examples of calculating expected returns, standard deviation of returns, and coefficients of variation for different investments. It also demonstrates how diversification across many randomly selected stocks can significantly reduce stand-alone or idiosyncratic risk while leaving market risk relatively unchanged.
Risk Return Trade Off PowerPoint Presentation SlidesSlideTeam
Presenting this set of slides with name - Risk Return Trade Off Powerpoint Presentation Slides. This deck consists of total of twenty nine slides. It has PPT slides highlighting important topics of Risk Return Trade Off Powerpoint Presentation Slides. This deck comprises of amazing visuals with thoroughly researched content. Each template is well crafted and designed by our PowerPoint experts. Our designers have included all the necessary PowerPoint layouts in this deck. From icons to graphs, this PPT deck has it all. The best part is that these templates are easily customizable. Just click the DOWNLOAD button shown below. Edit the colour, text, font size, add or delete the content as per the requirement. Download this deck now and engage your audience with this ready made presentation.
Basic concepts in decision making (EE&FA/C)Barani Dharan
This document discusses key concepts in engineering economics and financial accounting. It defines opportunity cost as the cost of an alternative that must be forgone to pursue a certain action. The incremental concept refers to changes in output, costs, or incomes. Discounting principles involve converting future cash flows to present value based on a discount factor. The concept of time perspective acknowledges that money received in the future is not worth as much as money received today due to interest earned over time.
The document is a resume for Philip Bryson Lee Ricks providing his contact information, objective, education history, awards, work experience, and availability of references. It shows that Ricks has over 10 years of experience in customer service roles in the food and beverage industry and is currently an order picker and forklift operator at an Amazon fulfillment center seeking an entry level position with room for growth.
This document lists 132 buyers and brands along with their headquarters where Tex Zippers is nominated or approved to supply zippers. It includes major retailers from around the world such as Abercrombie & Fitch, H&M, Gap, JC Penney, Walmart, Zara, and more. Tex Zippers has been approved as a zipper supplier for most of the buyers and brands listed in the document.
This candidate has over 18 years of experience in operations management, project management, and business analysis. They have a proven track record of successfully managing projects involving site migrations, electronic medical record implementations, infrastructure virtualization, and supply chain restructuring. They also have experience developing strategic plans and marketing campaigns that increased revenue and reduced costs. Their skills include project management, process improvement, budgeting, software implementation, and client engagement.
A inveja mata! O documento apresenta um caso que comprova definitivamente que a inveja pode levar à morte, confirmando o ditado popular de que a inveja mata.
Este documento describe los conceptos clave de los Entornos Personales de Aprendizaje (PLE), incluyendo el aprendizaje formal e informal y cómo los PLE permiten a los estudiantes tomar control de su propio aprendizaje a través del uso de tecnologías. También discute diferentes modelos de PLE, como aquellos basados en objetivos y tareas, el modelo conectivista, y los PLE a lo largo de la vida. Finalmente, aborda cuestiones técnicas y didácticas relacionadas con el uso efectivo de los PLE.
El documento describe dos actividades didácticas con TIC: la caza del tesoro y la webquest. La caza del tesoro consiste en una serie de preguntas con direcciones web que contienen las respuestas, y puede usarse para promover el aprendizaje sobre un tema. La webquest guía a los estudiantes a través de una tarea que involucra la búsqueda de información en internet según pasos especificados. Ambas actividades buscan desarrollar habilidades de búsqueda de información y comprensión lectora.
Concursul Monumentele Brailei, 4 decembrie 2012, organizat de Primaria Brailei, Biblioteca Judeteana "Panait Istrati" Braila, Inspectoratul Scolar Judetean Braila si Cercetasii Romaniei - Centrul Local Braila
Los UK Alumni Awards reconocen a ex alumnos sobresalientes de Reino Unido que han generado cambios positivos. La primera edición en México en 2017 busca identificar historias de éxito de mexicanos que estudiaron en Reino Unido para promoverlo como destino educativo de excelencia, creando una red de profesionales influyentes entre ambos países. Los galardones reconocerán logros profesionales, emprendimientos y aportes a la sociedad en una ceremonia el 16 de febrero de 2017.
El documento resume brevemente la historia de la ingeniería desde sus orígenes en la revolución agrícola hasta la ingeniería europea. Destaca los primeros avances en irrigación de los egipcios e ingeniería militar, así como las obras monumentales de los egipcios como las pirámides. También describe contribuciones de los griegos, romanos, chinos e hindúes en áreas como transporte, construcción y tecnología.
ENJ-300 Valor de la Autopsia en la Investigacion CriminalENJ
El documento resume los pasos de una investigación anatomo-patológica y clínica de un cadáver con el objetivo de determinar la identidad del fenecido, momento y causa de la muerte, y manera jurídica del fallecimiento. Detalla los análisis requeridos como rasgos faciales y corporales, huellas digitales, estudios de ADN, lesiones, y signos postmortem. Explica los conceptos de causa básica de muerte, manera jurídica de muerte, e informe médico-legal.
Este documento presenta la minuta de la segunda sesión ordinaria del Consejo Académico 2016-2018 de la Academia de Ingeniería. Se llevó a cabo el 9 de diciembre de 2016 en la Ciudad de México. Se discutieron varios temas como la aprobación de la minuta anterior, el seguimiento de acuerdos, el informe financiero, propuestas de modificación al estatuto y reglamento electoral, el papel de la Academia como testigo social, y la integración de comités editorial y de comunicación social. También
Este documento presenta el proyecto de grado de los estudiantes Mayorga Monserrate Clemencia Leopoldina y Merchán Loor Víctor Manuel para obtener el título de Licenciados en Ciencias de la Educación, mención Educación Básica. El proyecto investiga el uso de estrategias lúdicas creativas en el rendimiento académico de estudios sociales. El documento incluye la aceptación del tutor, la declaración de la autoría, la certificación de la defensa y dedicatorias.
This document discusses ratio analysis and various types of ratios used to analyze a company's financial performance and health. It begins by explaining that ratio analysis compares financial statement figures to provide useful insights beyond absolute numbers. It then covers several categories of ratios:
1. Liquidity or short-term solvency ratios measure a firm's ability to pay short-term debts and include the current ratio and quick ratio.
2. Capital structure or long-term solvency ratios assess financial leverage and include the debt ratio and interest coverage ratio.
3. Asset management or turnover ratios evaluate efficiency in deploying assets and include total asset turnover, fixed asset turnover, and inventory turnover.
4. Profitability
· Select and respond to 3 posts listed below. Advance the conversa.docxLynellBull52
· Select and respond to 3 posts listed below. Advance the conversation; provide a real-world application and experiential examples;
· Conceptually discuss your key [most significant] learning insight or take-away from the selected forum topic comments.
· Responses should be a minimum of 150-250 words, supported by at least one reference outside of the textbook, either supporting or refuting the position of the author of the forum topic response or peer response.
Discussion Topic #1: The Internal Rate of Return
The internal rate of return is a concept that is often addressed when looking into financial management. Osborne, 2011 defined the internal rate of return as the discount rate that sets the NPV back to zero. The concept is primarily used in capital budgeting to compare the profitability of investments. The higher the internal rate of return that is found then in theory the more profitable an investment the company should be. There are other factors that go into deciding if something is a good investment but the internal rate of return sets a strong indicator. As the paper further points out there are pros and cons that are associated with using the internal rate of return when deciding financial decisions.
The internal rate of returns as many positive aspects that go along with it. These strengths are the building blocks of what makes it an attractive option for financial managers. Anthes, 2003 described that is serves as a rate that can be a benchmark for investment decision-making. It is typically the favored method that is used and as a result is fairly universal across most financial managers. Another strength is that it can be applied to many aspects of business and life. For example it can be used to calculate profitable degree offerings for a school all the way down to a business purchase to serve as a point of reference that there will be a strong return. A final strength falls in the usage of the internal rate of return. The IRR is a rate quantity. This is verses options such as the net present value, which indicated the monetary value of a potential investment. The internal rate of return allows a company that is looking into investing to see the efficiency of the company and the quality and yield of the product they are producing. This is a better indicator of the type of investment that a business is about to make. As a final point though the formula can be a bit tricky to understand the overall results are much simpler to interpret than other financial formulas. This makes internal rate of return more user friendly when explaining the findings to committee members that do not have training in financial management, which is often the case when investment decisions are being made.
Even though there are strengths to using the internal rate of return there are also various weaknesses as referenced by Gitman, 2006. The primary weakness is that internal rate of return should only be used in deciding if a single pr.
The document discusses ratio analysis and provides definitions and formulas for various types of ratios used to analyze company financial statements. It covers 18 different ratios organized into categories of liquidity/short term solvency ratios, capital structure/long term solvency ratios, asset management ratios, and profitability ratios. The ratios are used to evaluate a company's financial health, performance, and efficiency in areas such as liquidity, leverage, asset utilization, and profit generation.
Ratio analysis is used to evaluate the financial performance and health of a business. Ratios show the mathematical relationship between two related figures and can be used for trend analysis and comparisons between firms. There are several types of ratios including liquidity ratios that measure short-term financial strength, activity/turnover ratios that measure efficiency, and profitability ratios. Current ratio, quick ratio, and inventory turnover ratio are some examples discussed. Ratios should be interpreted both individually and in comparison to past ratios and industry standards to evaluate performance over time.
This document summarizes key points from a lecture on budgeting for planning and control. It addresses common questions about budgets, including definitions of different types of budgets like master budgets, operating budgets, and financial budgets. It discusses how budgets are used for planning by translating goals into quantitative plans, and for control by setting standards and providing feedback. Specific topics covered include the roles of sales forecasts and budgets, how budgets in different areas depend on the sales budget, and factors to consider when individual managers in charge of areas like sales or production are perceived to have optimistic or pessimistic tendencies. The document also contrasts traditional static master budgets with more flexible and activity-based budgets.
Chapter 3 - Financial Benchmarking for Inventory Turns and Working CapitalSolventure
This article fits in a series of articles inspired by the book ‘Supply Chain Metrics That Matter’.
In her latest book Lora Cecere introduces ‘which are the metrics that matter’, ‘how to ensure strength, balance and resilience’, what are the ‘evolutions in different sectors’, …
In this third article, Bram tries to explore alternatives for measuring the cash side and the service-cost side of the supply chain triangle.
He compares inventory turns and CCC for the cash side. He compares EBIT and EBITDA for the service-cost side. We also derive the best practice curve amongst 3 benchmark companies and derive resulting targets for a combination of EBIT-inventory or EBIT-CCC.
We hope you enjoy the reading.
Operating Ratios asPerformanceMeasure s 11C H A P T E RTHE.docxhopeaustin33688
Operating Ratios as
Performance
Measure s 11
C H A P T E R
THE IMPORTANCE OF RATIOS
Ratios are convenient and uniform measures that are
widely adopted in healthcare financial management.
They are important because they are so widely used, especially
because they are used for credit analysis. But a
ratio is only a number. It has to be considered within the
context of the operation. There is another caveat: ratio
analysis should be conducted as a comparative analysis. In
other words, one ratio standing alone with nothing to
compare it with does not mean very much. When interpreting
ratios, the differences between periods must be
considered, and the reasons for such differences should
be sought. It is a good practice to compare results with
equivalent computations from outside the organization—
regional figures from similar institutions would be a good
example of such outside sources. Caution and good managerial
judgment must always be exercised when working
with ratios.
Financial ratios basically pull together two elements of
the financial statements: one expressed as the numerator
and one as the denominator. To calculate a ratio, divide
the bottom number (the denominator) into the top
number (the numerator). The Case Study in Appendix
25-A entitled “Using Financial Ratios and Benchmarking:
A Case Study in Comparative Analysis” uses financial
ratios as indicators of financial position. We highly recommend
that you spend time with this Case Study, as it
will add depth and background to the contents of this
chapter.
In this chapter we examine liquidity, solvency, and
profitability ratios. Exhibit 11-1 sets out eight basic ratios
After completing this chapter,
you should be able to
1. Understand four types of
liquidity ratios.
2. Understand two types of
solvency ratios.
3. Understand two types of
profitability ratios.
4. Successfully compute ratios
CHAPTER 11 Financial and Operating Ratios as Performance Measures
Exhibit 11–1 Eight Basic Ratios Used in Health Care
Liquidity Ratios
1. Current Ratio
Current Assets
Current Liabilities
2. Quick Ratio
Cash and Cash Equivalents + Net Receivables
Current Liabilities
3. Days Cash on Hand (DCOH)
Unrestricted Cash and Cash Equivalents
Cash Operation Expenses ÷ No. of Days in Period (365)
4. Days Receivables
Net Receivables
Net Credit Revenues ÷ No. of Days in Period (365)
Solvency Ratios
5. Debt Service Coverage Ratio (DSCR)
Change in Unrestricted Net Assets (net income)
+ Interest, Depreciation, Amortization
Maximum Annual Debt Service
6. Liabilities to Fund Balance
Total Liabilities
Unrestricted Fund Balances
Profitability Ratios
7. Operating Margin (%)
Operating Income (Loss)
Total Operating Revenues
8. Return on Total Assets (%)
EBIT (Earnings before Interest and Taxes)
Total Assets
Courtesy of Resource Group, Ltd., Dallas, Texas.
that are widely used in healthcare organizations: four liquidity types, two solvency types, and
two profitability types. All are discussed later.
LIQUIDITY RATIOS
Liquidity r.
ABC Healthcare Corporation is evaluating three capital budgeting projects: major equipment purchase (Project A), expansion to three additional states (Project B), and a new marketing campaign (Project C). This report analyzes each project using net present value (NPV), internal rate of return (IRR), payback period, and profitability index (PI). The analysis finds that Project A has the highest NPV of $44.2 million, IRR of 79.79%, payback period of 1.36 years, and PI of 5.43. Project A involves purchasing $10 million in equipment that reduces costs over 8 years and has the greatest financial benefits according to the capital budgeting tools.
Capital budgeting is the process of evaluating potential long-term investments and capital expenditures. It involves estimating cash flows, assessing risk, determining discount rates, and calculating metrics like net present value and internal rate of return to determine which projects to accept. Capital is a limited resource, so management must carefully evaluate projects and allocate capital to the most economically acceptable and profitable opportunities. However, net present value and internal rate of return sometimes select different projects, usually due to differences in project size, life, or cash flow patterns. Both metrics can be reliably used if the discount rate reflects true risk and an internal rate of return is reasonably achievable.
The document discusses how to analyze a business using financial ratios. It explains that ratios show the relationship between two numbers and can be used to compare a company's performance over time and to other companies in the same industry. The document then outlines 12 steps for conducting a basic financial analysis of a company, including acquiring financial statements, calculating common size ratios and other key financial ratios related to liquidity, debt, profitability, efficiency and stock value. These ratios can provide insights into a company's strengths and weaknesses.
Futurum stated and effective interest rateFuturum2
This document discusses stated and effective annual interest rates. It begins by explaining how corporate finance textbooks typically cover the calculation of stated and effective annual interest rates. However, it notes that textbooks often fail to provide important additional context and warnings. Specifically, textbooks usually assume interest is paid at the end of periods rather than upfront, and they don't address whether stated and effective rates using different compounding methods are truly equivalent given their different cash flows. The document then provides an expanded explanation of these issues and cautions the reader to think critically before applying formulas without consideration of these important factors.
This document discusses stated and effective annual interest rates. It begins by explaining how corporate finance textbooks typically cover the calculation of stated and effective annual interest rates. However, it notes that textbooks often fail to provide additional important context. Specifically, textbooks do not clarify that interest is usually paid at the end of a period, not the beginning, and do not address whether rates with different compounding methods are truly equivalent. The document then provides an expanded explanation of these issues and cautions readers to think critically about interest rate conversions.
Budgeting for planning and control almira zhafiraAlmiraZhafira
This document discusses key concepts related to budgeting, including:
- Budgets are quantitative expressions of plans used for both planning and control. They translate goals into operational terms and allow comparison of actual vs planned outcomes.
- All budgets depend on the sales budget, as other budgets are based on projected sales. A sales forecast estimates future sales, while the sales budget sets a sales goal.
- A master budget combines operating budgets like production with financial budgets like cash. It can be either static and fixed or flexible and adjusted based on actual results. A cash budget is particularly important for monitoring small business finances.
- An activity-based budget differs from the master budget by first determining activities and resources needed to
Budgeting for planning and control almira zhafiraAlmiraZhafira
This document discusses key concepts related to budgeting, including:
- Budgets are quantitative expressions of plans used for both planning and control. They translate organizational goals into operational terms.
- Control involves setting standards, receiving feedback on actual performance, and taking corrective action if needed. Budgets are used to compare actual and planned outcomes.
- Flexible budgets provide expected costs for a range of activity levels and are used for planning and analysis. They also provide budgeted costs for actual activity levels and are used for control.
- The steps in an activity-based budget start with output, determine necessary activities, and then resources, differentiating it from the traditional master budget approach.
FIN 430 — Finance Theory and PracticeProject AssignmentsCalculat.docxssuser454af01
FIN 430 — Finance Theory and PracticeProject Assignments
Calculating theWeighted Average Cost of Capital (WACC)
foryour Company
For use in Conjunction with the Firm Valuation Project
First ensure that you have read relevant pages in the text. Some important sections would include the following, but you may also double-check the references in the text by using the index [see: Cost of Capital and Target (optimal) Capital Structure, etc.]:
The important Chapter in the text is the one entitled "The Cost of Capital," – with a particular focus on the section entitled “The Weighted Average Cost of Capital” and the section “Four Mistakes to Avoid” at the end of the chapter.
The WACC formula discussed below does not include Preferred Stock. Should your company use PS, be sure to adjust the equation for it, and see the section in the chapter on the Cost of Preferred Stock.
The WACC formula that we use is:
WACC = wdrd(1-T) + wsrs
We need to know how to calculate:
1. rsthe cost of common equity. Use the Security Market Line (SML) – this is why you learn how to calculate a company’s beta and also why you learn how to find the appropriate risk-free rate and market-risk premium. For a review, see the section the text, The CAPM Approach.
2. The weights (wd and ws – note that: wd + ws = 1; so you only have to calculate one of them). We need to calculate the weight of debt and the weight of equity (for the cost of debt, this simply means: what proportion of the firm’s financing is by debt?). There is a lot to say here, simplified as Theory 1, Theory 2 and Practice:
a. Theory 1: Theory says that we should use the target weights along with the market values of both debt and equity (see the Four Mistakes to Avoid). But the market value of debt is typically difficult to calculate, because we need to know the YTM (which is rd) for all of the company’s debt, but we cannot calculate the YTM without having the current prices of the company’s outstanding bonds, and most company’s bonds do not trade (i.e., they will not have up-to-date or current prices – remember how to calculate the price (value) of a bond on your calculators?!). As a result, at least for the group project, we go to Theory 2.
b. Theory 2: Theory also says that we should use the TARGET weights, but this is a management decision, and as “outsiders” we do not have access to the thoughts of the CFO or CEO. So we should look instead to the historical pattern of the use of debt (mix of debt and equity), and this is one reason that you should have about 10 years of financial data.
c. Practice: Since we cannot “work” according to the strict theory of finance, we have to estimate the relevant weights. As a result, we will use the formula:
wd = Book Value of Debt / [Market Value of Equity + Book Value of Debt]
The book value of debt is calculated by adding up ALL of the debt on the balance sheet. This will typically be the sum of Notes Payable, Current Por ...
This document provides an overview of Week 2 topics in an accounting course, which include analyzing budgets, forecasts, and strategic plans. It defines budgets as formal expressions of management plans and objectives for a time period. The document discusses different types of budgeting software and the benefits and downsides of budgets. It also distinguishes between strategic plans, budgets, and forecasts. Finally, it provides an example of preparing a performance report using a static budget versus a flexible budget.
The document analyzes the potential for a company to expand into 16-ounce bottling by examining cash flows under three scenarios - a base case, pessimistic case, and optimistic case - finding that the pessimistic case yields a negative NPV while the base case and optimistic case produce positive NPVs, suggesting the expansion would be profitable under the base or optimistic forecasts but not under more pessimistic assumptions.
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Net Present Value for Asset Management Engineers
1. NPV for Asset Management Engineers WA Integrated Asset Management, 1 December 2016
NPVForAMEngineers.docx 1
Net Present Value for Asset Management
Engineers
Hein Aucamp
WA Integrated Asset Management
WA Integrated Asset Management is an
Infrastructure Asset Management company
serving Local Government and the mining
sector based in Perth, Western Australia.
www.waiam.com.au
A confession
I have a confession to make. About 3 or 4 years ago I was embarrassed because I got this wrong. My
background is engineering. If my background had been accounting, I would probably have been safer.
Different dollar values in Asset Management
Somehow I had drifted into thinking that a Net Present Value calculation does nothing more than
remove inflation from future dollar values. But it does more than that: it compares those future dollars
to a proper use of money.
And to those of us in Asset Management, it is not always obvious that a comparison is involved.
When we wear our Asset Management hats, we are usually not consciously making comparisons
about how well the money is being used. We are usually focused on how to manage the assets we
have got and which are aging, and about which we have no choice.
One difficulty with Asset Management is that we are dealing with different dollar values depending
on the documents we are using:
Asset Management Plans, with their 20 year projections, are in current dollar values. Every
single figure, now and in the future, represents the purchasing power of a dollar in this
financial year.
Financial budgets, on the other hand, are in nominal real dollar values. Future estimates in
income are the actual dollars that will be collected. Inflation is included. The dollar amounts
will be higher, but their purchasing power will be eroded by inflation.
So we need to be careful. For example, the Long Term Financial Plan contains information from both
Asset Management Plans and budgets, with their different dollar value figures. In the LTFP you have
a choice whether to use current dollar values or nominal real dollar values. So the LFTP has to have
an adjustment of either the Asset Management Plan figures or of the expected budgets to be able to
relate them to each other.
My specific difficulty was in calculating an Asset Renewal Funding Ratio (ARFR) from 10 years of
current dollar values in an Asset Management Plan. I got confused because inflation was already
stripped out, so I thought an NPV adjustment was not required, and that a simple sum would do.1
1
The ARFR is defined in the IPWEA AIFMG and also required of Councils in Western Australia by the DLG
Asset Management Framework and Guidelines.
2. NPV for Asset Management Engineers WA Integrated Asset Management, 1 December 2016
NPVForAMEngineers.docx 2
The Present Value and Net Present Value formulas
So let’s have a look at these formulas and understand precisely how to use them depending on what
we are trying to achieve.
As you know, the Present Value formula gives us the value in today’s dollars of a future amount. But
even when we use these exact words, we can mean slightly different things by value in today’s
dollars.
This is the formula: 𝑃𝑉 =
𝑉
(1+𝑖) 𝑛:
V is the nominal (face) value n years from today.
i is the discounting rate.
And as you also know, the Net Present Value formula is the sum2
of more than one future value to
allow us to relate a future income or expense stream to a figure in today’s dollars.
When we use these formulas, we need to get i right, because it differs depending on what we are
doing. There are 3 different parts making up i, and we need to choose between them.
Here are the three parts:
The total discounting rate: let’s call it it.
The inflationary part of the discounting rate: let’s call it ii.
The real part of the discounting rate: let’s call it ir.
It will be easier for us to start with ii.
The inflationary part of the discounting rate ii
This represents the erosion of value because of inflation. In 2012 (around the time I made my mistake
with NPV), the AIFMG gave an example of 3.5%.
If you are adding or removing inflation to relate Asset Management Plan figures to budgetary figures,
use only ii, and use it in the Present Value (not the Net Present Value) formula.
For example, if you were in 2012, you would have taken a 2016 budget figure of $1,000 and
calculated it to be
$1,000
(1+0.035)4 = $871.44 in 2012 dollars.
When you apply adjustments to individual items, such as columns of yearly figures in a spreadsheet,
you will almost always be either multiplying or dividing by the Present Value formula using ii as the
discounting rate.
The total discounting rate it and the real discounting rate ir
The total discounting rate it is the interest rate achievable in a safe investment. In 2012 an example of
8.0% was given in the AIFMG. The 10 year bond rate is often used. It is larger than inflation.
The real part ir is the portion of it which is net over inflation. You calculate this by division, not by
subtraction: (1 + 𝑖 𝑟) =
(1+ 𝑖 𝑡)
(1+𝑖𝑖)
. In 2012, it would have been
(1+ 0.080)
(1+ 0.035)
= 1.0435, which means ir was
4.35%.
2
Technically it could also be a single figure, but this doesn’t often occur in Asset Management calculations.
3. NPV for Asset Management Engineers WA Integrated Asset Management, 1 December 2016
NPVForAMEngineers.docx 3
The reason that these terms (it and ir) are important is the implicit comparison I mentioned earlier.
The NPV formula does not simply relate a future stream of incomes or expenditures to present day
values. It takes something additional into account. If I keep my money this year, and if I follow good
investment practices which beat inflation, it will be worth more next year in real terms.
E.g. if I had $1,000 in 2012, and invested it at the bond rate, in 2013 it would have been worth:
$1,000 * (1 + 0.08) = $1,080 in nominal real dollars.
$1,000 * (1 + 0.0435) = $1,043.50 in 2012 current dollars.
On the other hand, if I had kept the $1,000 without investing it, in 2013 it would have been worth:
$1,000 in nominal real dollars.
$1,000 / (1 + 0.035) = $966.18 in 2012 dollars.
When the Net Present Value formula is prescribed (as it is for the Asset Renewal Funding Ratio), it
includes this implied comparison. It includes as a reference whether proper use is being made of the
money, and whether the money is beating inflation by as much as it should be.
So if you are adding values together to evaluate future income or expense streams, you will almost
always use ir or it (and not ii) in a Net Present Value formula:
Use ir if you are adding current dollar values (e.g. projections in the Asset Management Plan).
Use it if you are adding nominal future dollar values (e.g. future budgets which include
inflation).
Use either ir or it when adding figures from your Long Term Financial Plan, depending on
whether it is written in current dollars or nominal future dollars.
Summary
In general, the summary below will apply. But make sure that you aren’t dealing with an exceptional
case.
Activity Formula to Use Discount Rate to Use
Adjusting individual figures to add or remove inflation Present Value ii
Summing real nominal dollar figures in future years Net Present Value it
Summing current dollar figures in future years Net Present Value ir
Note about Excel Present Value formula
Be careful of the Excel PV() formula. It works differently from the one I have presented above. It
sums the specified value over n years, instead of calculating one value n years in the future.