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TECHNICALS - BIWS GUIDE (TS) > ACCOUNTING > Flashcards

ACCOUNTING Flashcards

1
Q

What are the 3 financial statements, and why do we need them?

A

Income Statement: revenues/expenses, taxes over a period of time. Ends with Net Income - which tells us the co’s after tax-profits

Cash Flow Statement: tells us the actual cash inflows/outflows over a period of time. Starts w/ Net Income, adjusts for non-cash items and changes in working capital (operating assets and liabilities), shows CF from Investing & Financing activities, Ends w/ Net Change in Cash. & co’s ending cash balance

Balance Sheet: tells us the company’s resources (Assets) and how it paid for those resources (Liabilities, Equity) during a specific moment in time (“snapshot”). Assets = L + E.

We need them b/c: difference between company’s Net Income and actual cash flow it generates => 3 statements allow you to estimate cash flow more accurately.

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2
Q

How do the 3 statements link together?

A
  • Net income (to Common) from the IS flows to the top (first line) of the CFS and to the CSE in the BS.
  • CFS: add back non-cash charges & changes to operational BS items = CF from Operations. Then, account for CF from investing & financing activities
  • Change in Cash from the bottom of the CFS flows to Cash on the BS.
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3
Q

Income Statement - items/structure

A
  • Revenue (net sales)
  • COGS (expenses linked to individual units sold)
  • Gross Profit / Gross Margin (profit before fixed expenses; –> add. profit from each add. sale)
  • Operating Expenses (expenses NOT lined to specific items; ex - sales & marketing; R&D; G&A)
  • Operating Income (income from core biz)
  • other income / (expenses) (ex: “side activities”)
  • interest income / (expenses)

=> PRE-TAX INCOME
- income taxes
==> NET INCOME (bottom line - what a co earns after taxes)

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4
Q

Income Statement - criteria for appearing on IS?

A

1) must 100% correspond to the same period shown
2) must affect net income available to COMMON SHs

  • revenue/expenses = recorded when products/goods are DELIVERED
  • if useful for many years (ex: expense) –> does NOT correspond 100% to this period
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5
Q

Examples of BS Items that create differences between differences between Net Income & Cash Flow:

A

(based on short-term timing differences:)
- account receivable
- accounts payable / accrued expenses
- prepaid expenses
- deferred revenue
- inventory

(based on long-term timing differences:)
- capex (PP&E)
- debt
- equity
- preferred stock

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6
Q

Why is CFS the most important statement?

A
  • CFS tells you how much cash a co is generating
    –> valuation = based on cash flow
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7
Q

Why does IS not accurately represent cash flows?

A
  • includes non-cash items (non-cash revenue & expenses, taxes)
  • excludes certain cash spending items (ex: CapEX)
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8
Q

Balance Sheet - examples of Asset items

A

Assets = items that will deliver a future BENEFIT

examples:
- accounts receivable
- cash
- prepaid expenses

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9
Q

Balance Sheet - examples of Liability items

A

Liabilities = items that represent a future OBLIGATION

examples:
- accounts payable
- accrued expenses
- deferred revenue

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10
Q

Balance Sheet - Equity

A

Equity = source of funding for the biz that will NOT result in future cash costs.

includes:
- money contributed by the owners
- money raised by selling ownership in the biz
- co’s cumulative after-tax profits (net income) over time

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11
Q

Equity issuance - effect on 3 statements?

A
  • IS: NONE - not recorded
  • CFS: cash inflow
  • BS: increase in cash (A); increase in CSE (L&E)

*no “direct cash cost” as w/ debt (interest expense)
- rather: cost = dilution of existing ownership -> 1) get less in dividends (when issued) and 2) if co gets sold, get less proceeds from sale

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12
Q

Dividends issuance or stock repurchase - effect on 3 statements?

A
  • 3
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13
Q

Most impt financial statement?

A
  • CFS: shows how much actual CASH a company is generating –> & valuation is based on cash
  • contra IS: contains NON-CASH revenues, expenses, taxes & excludes cash spending items (ex: CapEX) -> doesn’t accurately represent co’s CFs
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14
Q

Criteria (for revenue or expense line item) to appear on an IS?

A

1) correspond 100% to period shown
- revenues/expenses = recorded based on DELIVERY of product or service

2) affect biz income available to common SHs
- ex: preferred dividends on IS: reduces after-tax profits that could go to common SHs

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15
Q

BS: Diffs bt Assets, Liabilities, and Equity line items?

A
  • Asset = result in future benefit
  • L&E item = result in future obligation; funding source for co’s resources (assets)
  • liability = usually related to external parties
  • equity = related to internal operations; tend not to result in direct cash outflows in the same way as Ls
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16
Q

Diffs bt IFRS & GAAP?

A

IFRS:
- CFS = starts w/ something OTHER than Net Income: Operating Income, Pre-Tax Income, or if direct method: Cash Received or Cash Paid
- items in more “random” locations on CFS
- Operating Lease Expense = split into Interest & Depreciation elements

GAAP:
- Operating Lease Expense = simple Rental expense

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17
Q

CFS - criteria for appearing?

A

1) HAS appeared on IS & affected Net Income, but is non-cash –> so need to adjust to determine co’s CF; or

2) has NOT appeared on IS & DOES affect CF

ex of 1: D&A
ex of 2: CF from Investing & Financing - CapEx; Dividends

  • changes in WC can be in either category
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18
Q

Cash vs. Accrual accounting

A
  • cash accounting = records revenues & expenses when cash is actually received or paid
  • accrual accounting = revenues are recorded when collection is reasonably certain; expenses recorded when they are incurred
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19
Q

Examples of line items from each of the financial statements?

A
  • IS: Revenue, COGS, D&A, SG&A expenses, Operating Income, Pre-Tax Income, Taxes, Net Income
  • CFS: Cash Flow from Operations (Net Income; Depreciation & Amortization; Stock-Based Compensation; Changes in Operating Assets & Liabilities); Cash Flow from Investing (Capital Expenditures, Sale of PP&E, Sale/Purchase of Investments); Cash Flow from Financing (Dividends Issued, Debt Raised / Paid Off, Shares Issued / Repurchased)
  • BS: Cash, AR, Inventory, PP&E, Accrued Expenses, Debt, CSE, SE
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20
Q

If you could only look at 2 statements - which would you use?

A
  • IS & BS: can create CFS from both (assuming you have “beginning” and “ending” BS that corresponds to same period as IS)
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21
Q

CFS - add-back for non-cash expense - why?

A
  • reflect tax savings w/ non-cash expense
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22
Q

Depreciation (of X) - effect on 3 statements?

A

*intuition: non-cash expense –> doesn’t “cost” co anything, BUT reduces taxes

  • IS: Operating income declines by X –> Net Income decreases by X * (1-tax rate) = Y
  • CFS: net income at top decreases by Y –> X in depreciation expenses is non-cash expense that gets added back ==> overall CF from Operations is up by -Y + X. Net change in cash is also up by this amount.
  • BS: Cash from CFS change is up. PPE is down. –> Overall assets are down. SE is down by net income decreased amount –> L&E side is down. Both sides balance
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23
Q

Why does depreciation (non-cash expense) affect cash balance?

A
  • it is tax-deductible –> tax savings –> increases cash by reducing amount of taxes you pay (since taxes ARE a cash expense)
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24
Q

Depreciation - where is it on the IS?

A
  • separate line item or
  • embedded in COGS or operating expenses
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25
Q

Accrued Compensation increase - effect on 3 statements?

A
  • IS: increase in operating expenses –> decrease in pre-tax income ==> decrease in net income
  • CFS: decrease in net income –> accrued comp = added back as non-cash expense –> cfo increases ==> change in cash increases
  • BS: cash is up; liabilities increase; CSE decrease
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26
Q

Inv increase - effect on 3 statements? (assume paid in cash)

A
  • IS: not on IS
    *not used up/sold during this period - expense only recorded when goods associated w/ it are sold
  • CFS: cfo decreases –> net change in cash is down
  • BS: cash decreases; inv increases
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27
Q

Start of Y2: No principal on debt is paid off, int rate of X%. PP&E depreciates.
–
Y3: PP&E breakdown & value written down. Debt principal must be paid back.

A

Start of Y1:
- IS: no change
- CFS: PP&E recorded under CFI => reduces CFs; debt raised => raises CFs ==> net change in cash stays the same
- BS: cash = no change; PPE increases; Debt = increases

Start of Y2:
- IS: depreciation & interest expense recorded -> Pre-tax income decreases ==> net income decreases
- CFS: net income down -> depreciation added back => overall cash down
- BS: cash down & PP&E down; CSE down

Start of Y3:
- IS: record write-down (AMOUNT = AT TIME OF BREAKDOWN) expense -> pre-tax income & net income down
- CFS: net income down -> add back impairment expense (non-cash); record cash outflow from principal repayment –> net change in cash (up or down)
- BS: Cash (up/down); PP&E down; Debt down; CSE down

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28
Q

Working Capital

A

WC = co’s current assets - current liabilities

  • often used as a financial metric; whether it is positive (or neg) tells you if co is “sound”
    –> if positive: co can pay off its short-term Ls w/ short-term As
    –> if negative: not necessarily bad sign; depends on co & situation –
    ex of good sign:
  • higher deferred revenue balances b/c of subscriptions or longer-term Ks
  • biz efficiency: customer pays upfront –> use cash generated to pay off AP, rather than keep large cash balance
    ex of bad sign:
  • financial trouble/bankruptcy (ex: customers don’t pay quickly enough/upfront –> co carrying high debt balance)
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29
Q

Write-down/Impairment of PP&E - effect on 3 statements?

A

“write-down”: value of asset has declined substantially -> current BV is no longer accurate (ex: damaged by hurricane; new tech made it obsolete)

*unlike depreciation: NOT deductible for cash-tax purposes
–> even though book taxes are down, cash taxes stay same

  • IS: record as an expense ==> decreases net income
  • CFS: decreased net income -> added back as a non-cash adjustment - PP&E added back & deferred income taxes recorded (negative adjustment)
  • BS: PP&E down; net DTA up; CSE down due to decreased net income
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30
Q

Negative SH Equity - is it possible? what does it mean:

A

*main items that link into CSE: Net Income & Dividends
–> If co’s Net Income = repeatedly negative, then CSE will also turn negatively eventually

  • can be cause for concern or sign that co is struggling/has been unprofitable

ex:

1) has issued too many dividends or repurchased too many shares
(ex: LBOs w/ dividend recaps: owner of co has taken out large portion of its equity (cash) –> can turn # negative

2) Co has been losing money consistently (unprofitable)
(ex: tech/biotech startup in early years)

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31
Q

Write-Down/Impairment of Debt (as a L) - effect on 3 statements?

A

When Ls are written down ==> record as a GAIN

  • IS: record gain –> net income up
  • CFS: net income up –> non-cash adj for gain (cash down)
  • BS: debt down; CSE ip
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32
Q

DEFERRED REVENUE
- why?
- what happens to it?
- diff w/ account recievable?

A

Cash collection (from customer) - not recorded as revenue
- collect cash upfront for services in the future
- under GAAP: only record revenue when services actually performed
(ex: subscription service; annual Ks)

–
- BS: Deferred Revenue up (L)
- as services are performed, deferred revenue decreases

–
- AR is an asset on the BS –> customer owes co $ for services already rendered (cash not collected yet)
- contra deferred revenue: co owes customer service for $ already paid (cash collected) ==> how much co is waiting to RECORD as revenue

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33
Q

Account receivable balance - how long does it take for co to collect?

A
  • generally 40-50 days
  • but differs by co: higher for co’s selling high-end goods; lower for smaller, lower transaction value co’s
34
Q

When to capitalize vs. expense a purchase?

A
  • Capitalized: when asset has useful life of 1yr+
    –> put on BS (rather than expense on IS) & depreciated/amortized over certain # of years
    (ex: PP&E)
  • Expensed: covers only a short period of operations
    –> put on IS as normal expense
35
Q

EBITDA - drawbacks of metric?

A
  • does NOT include: investment in (& D of) long-term assets (CapEx), interest and one-time charges
    ==> can be misleading. co can have positive EBITDA, but still be CF negative.
  • ex: co can have positive EBITDA for past 10 years then go bankrupt b/c
    1) CAPEX: spending too much on capex
    2) INT EXPENSE: has high int expense & no longer able to afford its debt
    3) DEBT: debt all matures on 1 date & is unable to refinance it due to a “credit crunch” & runs out of cash when paying back debt
    4) significant one-time charges (ex: litigation) - enough to bankrupt co!
36
Q

Goodwill Impairment - what does it mean? why would it happen?

A
  • usually in acqs where buyer “overpaid”: after an acq, buyer re-assesses –> finds that intangible assets acq (ex: customers, brand, IP) are worth less than they originally thought
    *can result in: large net loss on IS
  • or co discontinues part of its operations –> must impair associated goodwill
37
Q

Goodwill - when would it increase?

A
  • Usually:
    1) co gets acquired or bought out –> Goodwill increases as a “plug” for acq purchase price
    2) co acquires another co –> pays more than what its tangible assets are worth ==> this excess is recorded as Goodwill
  • RARE SCENARIO: acqs where buyer “underpaid”: after an acq, realizes (after reassessment) that intangible assets acq are worth MORE than they originally thought
38
Q

Gain/Loss

A

*intuition: spent more/less to buy this equipment in a prior period

Gain = recorded as sold for price - current V

39
Q

Non-cash adjustments on IS - intuition

A
  • based on what happens in the current period
40
Q

Financing activities (external) - impact on statements?

A

Debt/Equity issuances:
- initially: both only show up on CFS (CF from Financing) –> increases cash balance (BS)

Equity:
- after issuance: share co increases –> existing investors get diluted

Debt:
- co must pay interest -> recorded on IS -> reduces net income & reduces cash
–> must eventually repay full balance

41
Q

Diff ways to fund co’s operations (via external) ops?

A

1) Debt
- cheaper than equity - for MOST co’s
- co must be able to pay int expense & possible principal repayments

2) Equity
- more expense
- if co can’t service its debt & make repayments -> use eq instead

42
Q

Financial investments - impact on statements?

A
  • initial purchase:
    –> only on CFS: recorded under CF from Investing –> reduces CF
  • afterward: Interest income
    –> IS: Interest Income recorded ==> increases Pre-Tax Income, Net Income
    –> CFS/BS: increases cash
43
Q

Financial investments (ex: buy stocks and bonds) - why do co’s do this?

A
  • co has excess cash and can’t think of another way to use it
44
Q

Accounting Statements after an ACQ:
- Why record Goodwill & Other intangible Assets?

A
  • Record Goodwill & Other Intangible Assets so that the BS balances

After an Acq:
1) seller’s assets & liabilities combine w/ buyer’s, but it’s CSE is written down
2) If an acq pays a premium: then BS will go out of balance (greater decrease in cash - asset side - than liabilities)
3) So, first allocate value to “identifiable intangible assets” (ex: patents, trademarks, IP, customer relationships)
4) If there’s a gap after that, allocate rest to “Goodwill” which plugs in that gap

45
Q

Why would Goodwill & Other Intangible Assets change over time?
Impact on financial statements?

A

Goodwill: only changes if it is “impaired”: re-asses acq after the fact and decides it is worth less than initially expected ==> write down goodwill

–> On the IS: 1) recorded as an an expense (Goodwill Impairment) and 2) CFS: add back Goodwill Impairment as non-cash expense

Other Intangible Assets: Amortize over time (unless they are indefinite-lived)

–> On the IS: 1) Record as an expense (Amortization) and 2) add back Amortization as a non-cash adjustment
–> On BS: Balance of Asset decreases, until it has amortized completely

*NOTE: Neither Goodwill Impairment nor Amortization of Intangibles is deductible for Cash-Tax purposes –> co’s cash balance won’t increase; instead, DTA or DTL will change

46
Q

Operating Expenses - effect on 3 statements?

A

*intuition: simple cash expense

IS: pre-tax income; net income
CFS: net income; cash at bottom
BS: cash; assets; CSE

47
Q

Changes to CASH ITEMS on IS - 3 statement effect?

A

Changes:
IS: net income
CFS: cash
BS: CSE

(ex: OpEx

48
Q

Changes to OPERATIONAL ITEMS on BS - 3 statement effect?

A

tricky

49
Q

Changes to Non-Cash Items on IS - 3 statement effect?

A

Changes:

IS: net income
CFS: Cash
BS: CSE; something else; DTA or DTL if there is a book vs cash tax effect

50
Q

Sells CapEx for Cash - 3 statement effect

A

Changes:

IS: only record if gain/loss
CFS: adjust non-cash expense if gain/loss; CF from investing up –> cash up (from cash influx from selling & from tax savings if gain/loss)
BS: cash up; capex down; cse changes if gain/loss

51
Q

Stock Based Compensation - 3 statement effect

ex: co CHANGES employee’s comp by offering stock options instead of cash salary (which was $100). Now, will get $120 in options instead.

A

SBC = OpEX

*intuition: co increases cash balance by switching employee to SBC, but doesn’t get cash-tax savings ==> cash is up only a certain # (rather than larger $)

  • IS: OpEx increases –> pre-tax income falls, net income falls
  • CFS: net income down; add back SBC as non-cash expense; deferred tax adjustment (b/c not cash-tax deductible) –> cash up
  • BS: cash increase
52
Q

Accounts receivable increase? - 3S effect

Cash collection later (AR decrease)? - 3S effect

A

AR increase (co orders, but hasn’t paid):
*intuition = co has to pay taxes on revenue it hasn’t collected in cash, so cash balance falls

  • IS: Rev up; pre-tax / net income up
  • CFS: net income up; increase in AR -> CF down ==> cash down
  • BS: cash; AR; CSE

AR is collected:
*intuition = simple cash collection of payment owed to co
- IS: no change
- CFS: decrease in AR ==> CF up
- BS: cash (up); AR (down)

53
Q

Prepaid expenses? - 3S effect

Prepaid expense is recognized? - 3S effect

A
54
Q

What are FCFs? What does it mean if its positive and growing?

A
55
Q

FCFs - what does it mean if negative and declining?

A
  • need outside funding sources to stay afloat
  • co is struggling; not generating enough CFs from core biz activities to offset its funding sources
  • You have to find out why FCF is negative or decreasing first. For example, if FCF is negative because CapEx in one year was unusually high, but it’s expected to return to normal levels in the future, negative FCF in one year doesn’t mean much.
  • On the other hand, if FCF is negative because the company’s sales and operating income have been declining each year, then the business is in trouble.
  • If FCF decreases to the point where the company runs low on Cash, it will have to raise Equity or Debt funding ASAP and restructure to continue operating. Short periods of negative FCF, such as for early-stage startups, are acceptable, but if a company continues to generate negative cash flow for years or decades, stay away!
56
Q

What does NCI look like on the Income Statement? What about Minority Investments? Where else do these appear on the financial statements?

A

NONCONTROLLING INTERESTS: represents what a co DOES NOT OWN when it owns a majority, but less than 100% of another co
- On the Balance Sheet: within Equity, record NCI (ex: 30% stake of co B NOT owned by co A)
–> B/c when co owns a majority of another co, their balance sheets are consolidated
- On the IS: adjusts by deducting NCI portion of co B’s Net Income out of the Net Income –> gets to gets to “Net Income Attributable to Parent”
-On the CFS: ensures that only co B’s portions of CFs owned by parent shows up

MINORITY INVESTMENTS: represent a co’s MINORITY STAKE in another company
-On the balance Balance Sheet: Assets side (ex: 30% stake in CoB)
- BUT: financial statements are NOT consolidated
- On the IS: adjusts for Net Income & Dividends from co B by adding to the Net Income –> gets to “Net Income to Parent”

57
Q

Buying PPE w/ Debt

A
58
Q

Selling Inventory

A
59
Q

*Q:
How to increase EBITDA using diff accounting practices?

A
60
Q

How to calculate EBITDA?

A
61
Q

*Q (EVR):
If I had Net Income of $20, EBITDA of $20, what would explain that?

A
62
Q

*Q: Depreciation on FS? (Ex: $10)

A
63
Q

*Q: Debt issuance on FS? (ex: $100)

A
64
Q

Cash Conversion Metrics

A

Days Sales Outstanding (DSO) = Accounts Receivable / Revenue * Days in Year
(How quickly it takes co to collect receivables)

Days Inventory Outstanding (DIO) = Inventory / COGS * Days in Year
(How quickly it takes co to sell inventory)

Days Payable Outstanding (DPO) = Accounts Payable / COGS * Days in Year
(How quickly it takes co to pay suppliers)

65
Q

What does it say about a company if its Days Receivables Outstanding is ~5, but its Days Payable Outstanding is ~60?

A

Company has quite a lot of market power to collect cash from customers quickly and to delay supplier payments for a long time.

Examples might be companies like Amazon and Walmart that dominate their respective markets and that often make suppliers “offers they can’t refuse.”

66
Q

Cash Conversion Cycle

A

DIO + DSO - DPO

  • tells you how much time it takes co to convert its inventory & other short term assets (ex: AR) into cash
  • lower is better: means the co “converts” these items into CF more quickly.
67
Q

Uses of cash?

A
68
Q

Change in Working Capital

A
  • AKA changes in operating assets and liabilities
  • Working Capital is a part of a company’s FCF
  • we care most about the change. Not WC itself
  • The change in WC tells you whether “Cash Flow” is likely to be greater than or less than the company’s Net Income, and how much of a difference there may be
  • Working Capital = Current Operational Assets - Current Operational Liabilities (excludes Cash, Financial Investments, and Debt)
  • Change in Working Capital = Old Working Capital - New Working Capital
  • if change is negative, it reduces Cash Flow, reducing co’s valuation; if it’s positive, it increases Cash Flow, increasing co’s valuation
  • the change in WC as a percentage of Revenue tells you how significant it is for the company’s “cash flow”
69
Q

Credit Metrics

A

Leverage Ratio: Total Debt/EBITDA
- tells you how much Debt a co has, relative to its ability to repay the Debt
- higher numbers are riskier, and lower numbers are less risky

Interest Coverage Ratio: EBITDA/Interest Expense
- tells you how easily the co could pay for its current interest expense on the Debt
- higher numbers are better: indicates more of a “buffer” in case the biz suffers & profits fall

70
Q

Returns-Based Metrics

A

Measure how efficiently a co is using its “capital” or assets to generate income

  • ROA (Return on Assets) = Net Income (to Common)/Avg. Total Assets
  • ROE (Return on Equity) = Net Income (to Common)/Average (Common) SHE
  • ROIC (Return on Invested Capital) = NOPAT / Avg. Invested Capital
  • NPOPAT = EBIT * (1-Tax Rate) –> Income avail to all investors after taxes (so, must exclude net interest expense and preferred dividends)
71
Q

Deferred Tax Liabilities - 3 FS effect?

A
  • BS: Deferred Tax Liabilities (DTL) decreases when cash taxes (what co actually pays) is lower than book taxes (b/c means co now paying those higher cash taxes, reducing its liability) & increases when book taxes exceed cash taxes (b/c means that co will need to pay higher cash taxes in the future)
  • CFS: when cash taxes (what co actually pays) EXCEEDS book taxes, DTs are negative on the CFS (b/c co is paying more than what is shown on the IS). if book taxes EXCEED cash taxes (what co actually pays), DTs are positive
72
Q

Deferred Taxes - what is it? Examples of what causes it.

A

Represent the DIFFERENCE b/t the co’s book taxes (on the IS) and Cash Taxes (what the co actually pays to the govt).

What causes deferred taxes:
- accelerated depreciation
- non tax-deductible expenses (ex: SBC)
- tax credits (ex: R&D credits)
- NOLs
- asset/goodwill write ups in M&A
- revenue recognition over time
- inventory differences (LIFO vs FIFO)

73
Q

Net Operating Losses

A

When a company loses money in the current period (resulting in negative pre-tax income), they accumulate a net operating loss (NOL) (= the amount negative pre-tax income) which they can apply in future periods, when their pre-tax income turns positive, to reduce their tax burden/realize tax savings.

  • if pre-tax income is negative -> add it to NOL balance

NOLs result in creation of DTAs.
–> using NOLs: decreases DTAs
–> accumulating NOLs: increases DTAs

74
Q

Deferred Tax Assets (DTAs)

A

Represent Potential future tax SAVINGS.

If DTA decreases –> CFs increase (b/c using NOL to reduce taxes)
If DTA increases –> CFs decrease

75
Q

How do NOLs affect the 3 statements?

A
76
Q

Stock-Based Compensation - effect on 3 statements?

A

initial issuance:
-IS: recorded on IS as an expense –> reduces income
-CFS: added back as non-cash expense
-BS: increases share count

*initially, not cash-tax deductible. only deductible when exercised, which is hard to predict, so usually ommitted in models.
*when SBC changes a co’s share count (so reduces the co’s value to existing investors), so treat is as a normal cash expense in valuations.

77
Q

Gross Profit

A

Revenue - COGS = Gross Profit

(*COMES BEFORE OPERATING EXPENSES, SBC, ETC.)

78
Q

Calculate EBITDA margin from Rev multiple and EBITDA multiple

A
  • ebitda margin = ebitda / revenue
  • revenue multiple / ebitda multiple = editda / revenue
79
Q

*Q: A company’s UFCF > EBITDA. What causes this?

A
80
Q

tell me about the different sections of the cash flow statement

A

TECHNICALS - BIWS GUIDE (TS) (8 decks)

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