CFI Financial Modeling and Valuation Analyst (FMVA) Practice Exam

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• A company with high accounts receivable is often trying to achieve what strategic outcome?
• In models with revolver debt, how is interest typically estimated?
• Which phrase describes accrual basis accounting?
• Contributed surplus represents which of the following?
• How is Ending PP&E computed in BASE analysis?
• When authorized shares are increased, how do common stock and APIC change?
• Which ratio represents interest coverage?
• In case of cash shortfall, what action is taken?
• Which statement best defines the cash accounting method?
• In the enterprise value bridge, which item is a source of value?
• Trade payables refer to which of the following?
• LTM numbers are calculated as:
• Which statement best describes how to determine total liabilities and equity at period end?
• Authorized vs issued shares: which statement is true?
• Non-current assets are assets kept for more than one year and are categorized into which three groups?
• In an asset deal, which measure is usually communicated to the public?
• EV/Subscribers is used for which industries?
• Which price is used to determine the premium in a transaction comp?
• As of December 31, 2021, how many options were expected to vest (in millions)?
• A manufacturing company has a year from July 1 to June 30 and purchases arrive June 30 but the bill is $50,000; how is this shown on the balance sheet on June 30?
• What is the formula for profit margin?
• Which item is typically classified as debt on the balance sheet?
• Which statement best describes the components of working capital days ratios?
• Which statement is true about issued vs outstanding shares?
• Leases can be classified as which type?
• What is the discount rate formula given PV, FV, and years?
• Which term refers to the quantity of goods a firm has on hand?
• Total debt includes which components?
• Is it true that dividends must be paid to preferred shareholders before common shareholders?
• Under cash accounting, when are income and expenditures recorded?
• If depreciation exceeds additions (Capex) in a period, what happens to NBV?
• In CAPM, what is the formula for Ke?
• What is the growing perpetuity value formula when cash flow grows at rate g and discount rate r?
• Net PPE on the balance sheet represents which of the following?
• APIC stands for which of the following and what does it represent?
• Which concept ensures expenses are recognized in the same period as the revenues they helped generate?
• Goodwill is defined as?
• Ending retained earnings are calculated as which of the following?
• What is the formula for Operating Working Capital (OWC)?
• If a company has multiple common share classes, how should you treat them when calculating diluted shares?
• Which formula defines outstanding shares at year-end?
• Which non-cash charge is added back to EBIT to approximate cash flow from operations?
• What does capex greater than depreciation imply for the asset base?
• Which items are considered non-current assets?
• To determine market capitalization, which type of shares should be excluded from the calculation?
• Which statement best describes diluted shares outstanding?
• Which item is a current liability?
• Under accrual accounting, revenue can be recognized when the service is performed even if cash has not been collected. Which option reflects this timing?
• What is the correct formula for the effective tax rate (ETR)?
• Which item is NOT a current asset?
• What was the total number of stock options outstanding on December 31, 2021 (in millions)?
• Which items are typically accrued liabilities?
• For estimating Kd, which approach is recommended?
• Which item is typically classified as a non-current liability on the balance sheet?
• If surplus cash exceeds the revolver balance, what happens?
• Which components are included in the BASE analysis for forecasting PP&E?
• How is the control premium generally estimated in M&A analyses?
• Gains from FVOCI investments increase which component on the balance sheet?
• A stock option is in the money when which condition is true?
• In the BASE framework for intangibles, what does the 'Subtract' line represent?
• Debt-like claims in enterprise value discussions typically include which items?
• A capital lease is treated as financing because it...
• How is Free Cash Flow (FCF) defined?
• Which valuation methodologies are typically included in a football field chart?
• Non-controlling interests (NCIs) represent ownership by which group?
• What does TV stand for in DCF valuation?
• Which statement is true about deferred tax assets and liabilities?
• Enterprise value is primarily driven by which factors?
• The difference between net income and operating profit is primarily due to which items?
• Which statement about preferred stock is correct?
• To compute the marginal tax rate (MTR) in the US, which components are typically used?
• What is PIK interest?
• Under accrual accounting, which statement about revenue is true?
• What is an Original Issue Discount (OID) in debt instruments?
• Change in an asset is calculated as Last year balance minus This year balance; Change in a liability or equity is This year balance minus Last year balance. Which option correctly describes these formulas?
• What is the purpose of including non-core assets in valuation?
• Which statement best describes timing of revenue recognition in accrual accounting?
• Under cash accounting, when is revenue recognized?
• Which valuation approach focuses on ownership and is affected by financing decisions?
• Profits and cash flow can differ due to what?
• Which of the following is typically considered an operating asset?
• Which statement about current assets is true?
• A company with a very small free float is likely to exhibit which characteristic?
• Why are LTM EBITDA figures commonly used as a value driver in transaction comps?
• Approximately how many stock options were exercised in 2021?
• In the sense-check EV multiple equation, EV multiple = TVn(GP) * (1+w)^0.5 / LTM EBITDAn. Which variable does NOT appear in the equation?
• Which statement describes non-cash working capital?
• What are free float shares?
• What is working capital?
• Which statement records all revenues earned and expenses incurred, regardless of cash?
• To compute the premium, premium per share is multiplied by which shares?
• Which expression correctly defines operating profit?
• Which qualitative factor can drive a higher control premium in a takeover?
• Who has the authority to increase the number of authorized shares?
• Depreciation should be calculated over which of the following?
• Which term describes expenses incurred but not yet paid in cash or recorded?
• Which item is typically a current liability?
• Which items are operating current assets (OCAs)?
• How does a cash flow surplus or shortfall affect the revolver?
• For operating working capital (OWC) forecasting, which tax figure should be used?
• In accounting, goodwill is defined as…
• Which statement best describes accrual basis accounting?
• Amortisation (of intangible assets) is best described as:
• Negative operating working capital is defined as?
• Which is an income statement line item?
• In Excel, which keyboard shortcut locks an absolute reference?
• Non-core assets are best defined as assets not valued by which process?
• If you know EBITDA, EBIT, and Amortization, how do you compute Depreciation using the given relation?
• In forecasting PPE, which equation correctly yields Ending PPE?
• What is the purpose of cash flow from operating activities?
• Where can depreciation and amortization amounts typically be found?
• Which condition indicates an acquirer is ideal when considering synergies?
• Which balance sheet component could be described as accumulated profits reinvested in the business and not distributed as dividends?
• Which components are included in invested capital according to the material?
• What is the immediate result of multiplying the offer price by diluted shares outstanding?
• In PIK calculations, what is the interest amount equal to?
• In liquidity planning, which item is considered a source of liquidity?
• Contingencies are
• In cash accounting method, when are income and expenditures recorded?
• Enterprise value (EV) is calculated as equity value plus financial liabilities minus financial assets. True or false?
• Which formula defines A/R Days according to the material?
• When using trading multiples, which pairing is typically considered consistent with a value driver?
• Common shares/stock are defined as?
• Which statement is true about non-current assets?
• Depreciation is a non-cash expense that does not directly affect cash flows. Which statement is true?
• The long-term growth rate in the sense-check LT growth rate formula is:
• If Operating Profit is 20% of Sales, which of the following expresses the Operating Profit Margin?
• Which statement best contrasts cash and accrual accounting regarding revenue recognition?
• In Free Cash Flow calculation, which adjustment adds back non-cash items like depreciation and amortization?
• Which basis would recognize revenue when cash is received?
• What is the Excel keyboard shortcut to insert a cell comment?
• Which cash flow activity is part of investing activities?
• What does ETR stand for?
• Accrued expenses are recognized in which period?
• Total premium paid is calculated as premium per share multiplied by which quantity?
• The total intrinsic value of stock options exercised in 2021 was how much (in millions)?
• If a company changes its capital structure by issuing debt and using funds to repurchase stock, with no change in operating performance, what happens to EV multiples?
• EV/Rooms is commonly used for valuing companies in which sector?
• Which set lists examples of intangible assets?
• Which statement about amortization and impairment for intangibles is true?
• In a merger of equals, which statement is typical?
• In BASE analysis for retained earnings, what does 'Subtract Divs Paid' represent?
• Which multiple is specifically noted as useful for capex-intensive companies?
• Which phrase best describes intangible assets?
• Which tax rate is applied to incremental income?
• A company buys three assets with different depreciation policies. Excluding tax, which asset will have the lowest cash impact due to depreciation?
• What is a typical range for a control premium in M&A deals?
• Treasury stock is:
• Contributed surplus can result from reacquisition of shares.
• Which statement about retained earnings is true?
• What best defines Equity Value in a typical valuation framework?
• In BASE analysis for retained earnings, which operation corresponds to the 'Add' line?
• In the sense-check for EV multiple, what is the effect of increasing w (WACC) on the EV multiple, assuming TVn(GP) and LTM EBITDAn constant?
• Which item is defined as cash or items that act like cash that a business holds?
• Which basis recognizes revenue when earned and matches expenses to the revenues they helped produce?
• How is Net Book Value (NBV) defined?
• Which form of consideration is most common for acquisition of a non-listed entity?
• What characterizes preferred shares?
• Why do RSUs typically have no strike price when considering diluted shares?
• Enterprise Value is defined as:
• What is the standard formula for the implied value of equities using dividends and growth?
• Which statement correctly describes the relationship between operating profit and gross profit?
• Which of the following is considered an intangible asset?
• What is the formula for the working capital cycle (in days)?
• Investing Activities include which of the following assets or items?
• Which statement is true about terminal value in a DCF?
• Unearned revenue is classified as which type of liability?
• Why would a growing company typically have capex exceeding depreciation?
• Common Shares provide
• What does the PV function calculate?
• A capital lease obligation is best described as:
• Which item is a component of shareholders' equity?
• Which formula defines earnings per share (EPS)?
• Which data should be used to estimate potential dilution from stock options in diluted EPS calculations?
• Which rating category is considered investment-grade?
• What does cash flow from operating activities represent?
• In the balance sheet, where are the most liquid items typically listed?
• What is the present value of a cash flow of 200 to be received in 7 years at a 6% discount rate?
• Which US filing updates annual or interim reports and can include details of acquisitions?
• Non-core item example?
• If a company pays dividends, which cash flow section is affected?
• Which formula correctly computes cost of goods sold using inventory changes?
• Which statement about ETR is commonly true?
• In the material, how are Accrued Expenses and Accrued Liabilities defined?
• Which instrument is used for short-term financing in money markets?
• Which marginal tax rate is given for the UK in the example?
• Which of the following are examples of intangible assets?
• A hostile takeover typically involves a higher premium paid than a friendly takeover. Which of the following is correct?
• Converting IFRS to US GAAP for operating leases involves:
• Which term describes expenses incurred in one fiscal period but not paid until a later period?
• APIC stands for what on the balance sheet?
• What is the difference between Basic WASO and Diluted WASO?
• Which description best defines Other Comprehensive Income (OCI)?
• When checking output, which practices are recommended?
• NOPAT/EBIAT stands for which of the following?
• A deferred tax liability represents which of the following?
• Which term describes cash flows related to obtaining funds like debt and equity plus paying dividends?
• Which statement best describes net debt?
• In liquidation, do preferred shareholders have an earlier claim on assets than common shareholders?
• What is par value?
• Which statement best defines Non-controlling interest?
• Under accrual accounting, revenue earned but cash not collected is recorded how?
• Which formula represents Operating Profit Margin?
• In the context of amortization, which statement best describes straight-line amortization?
• An 8-K report is described as which of the following?
• Deferred revenue is best defined as?
• Which description correctly defines accrued expenses?
• What does the current portion of capital lease obligation represent?
• In forecasting PP&E, which ratio is used to project capital expenditures based on historical performance?
• What is the cash flow from operating activities defined as?
• What method is used to account for convertible bonds in diluted equity value?
• When deriving Free Cash Flow from EBIT, which sequence is correct?
• Which item is NOT typically a current liability?
• Accrual Basis Accounting recognizes revenue and expenses in what manner?
• Which formula best represents the capital asset turnover ratio in this approach?
• In BASE analysis for PPE, what does the 'Add' line represent?
• Which statement best describes forward-looking normalization in trading comps?
• Which factor is least likely to result in raising total % premium paid over the current share price?
• Which statement best describes the accrual basis accounting method?
• For a private target, what is true about the observation of control premium?
• Dividends paid are shown as which of the following on the cash flow statement?
• Where should you obtain Basic Shares Outstanding in a capital-structure analysis?
• Which sequence shows the mid-year discount factors for five periods in a mid-year DCF?
• In public market valuations, the price for a minority stake is often referred to as which term?
• What is the current portion of long-term debt?
• In a merger of Equals, what information should be provided to properly populate the multiples grid?
• Which term describes expenses incurred but not yet paid or recorded?
• In calculating diluted earnings per share, which item is included to reflect potential additional shares from options?
• Which formula represents terminal value using the growing perpetuity method?
• What does Rf represent in CAPM?
• Which section reports cash flows from investments in noncurrent assets?
• Which statement shows cash inflows and outflows for a period?
• If a bond is classified as FVOCI and its market value increases while the bond is not sold, how is the gain reflected on the financial statements?
• Which statement is correct regarding equity awards with no strike price?
• Which US filing documents the offer to shareholders?
• Which depreciation method yields a constant depreciation expense over the asset's life?
• Which statement best describes preferred shares?
• On the balance sheet, which item represents the current portion of long-term debt?
• Which statement correctly describes treasury stock?
• Which tax rate reflects the overall average tax burden?
• The leverage effect on ROA is represented by which expression?
• In DCF, what is WACC used for?
• Which equation represents the present value of a perpetuity with payment PMT and discount rate r?
• When cleaning ETR, which is the recommended action?
• Why do companies keep authorized shares above issued shares?
• Which metric is widely used but affected by capital structure and accounting issues?
• What does WACC primarily reflect in valuation?
• Other comprehensive income includes which item?
• What is the formula for Terminal Value using a perpetuity growth model (TVn(GP))?
• Which term describes money invested in the firm by outside parties?
• A deferred tax asset represents what?
• In liquidity stress testing, how is "Strong" defined?
• If a company purchases equipment for cash, which cash flow section is affected?
• Which of the following is included in the Free Cash Flow calculation?
• PPE stands for what?
• Depreciation expense directly increases which balance sheet account?
• Which items are typically considered tangible assets?
• In a company with stable growth, how does capex typically compare to depreciation?
• Cleaning EBIT from Operating Profit yields which metric?
• Dividends are typically classified under which cash flow category?
• The working capital cycle is defined as which of the following?
• Purchases of intangible assets are classified under which cash flow activity?
• Which balance sheet item would show the asset representing the premium paid on acquiring another company?
• What does negative net debt indicate?
• What does MTR stand for?
• Amounts to be received in the future due to sale of goods or services?
• In sensitivity tables, where should data be placed for the table to work correctly?
• Which statement about authorized shares is true?
• What does 'clean' EBIT represent?
• For private deals, which item is required as part of the information?
• As businesses mature, acquisition multiples tend to
• For calendarization, the comparison is performed using which weights to align to the Target's earnings period?
• To forecast ETR, you should what?
• When should enterprise value adjustments be made in pro forma analysis?
• Unearned revenue represents?
• Which statement is true about accrual expenses?
• In a DCF, which methods are used to calculate terminal value?
• Covenants given by banks to debt to normal companies are typically around which leverage threshold?
• Treasury shares refer to shares that are:
• Which statement describes the relationship between accrual and cash accounting?
• On the balance sheet, which items are considered financing items?
• Restricted shares, after vesting, typically provide what rights?
• An accounting system entering expenses and revenues only when cash is received or paid out?
• In the BASE analysis for PP&E forecasting, what is considered the starting point?
• Which category includes land, buildings, and equipment?
• Which section reports cash flows from transactions affecting the equity and debt of the business?
• Equity value can be estimated as which of the following?
• What does Cleaning Net Income refer to?
• Current liabilities are obligations that are due
• If treasury stock increases by $1, with no other changes, what happens to total equity?
• What are authorized shares?
• Restricted shares are non-transferable until certain conditions are met. Which is a typical condition for vesting?
• In trading comps analysis, which measure should generally be preferred to summarize valuation multiples?
• Current liabilities are best described as obligations that are due
• Which would be considered a use of liquidity in a stress scenario?
• In an asset purchase, what is consolidated into the acquirer?
• In a DCF model, what is the purpose of the discount factor?
• Which best defines non-cash working capital?
• Which items are operating current liabilities (OCLs)?
• Which statement best defines ROIC as described in the material?
• If two companies have identical underlying business but different capital structures (one with substantial debt and one with large cash holdings), what typically happens to EV multiples and P/E multiples?
• In CAPM, which equation correctly defines the cost of equity Ke?
• In acquisitions, which use is primarily associated with an RCF?
• Which of the following is a current liability?
• Which assets are considered cash equivalents?
• Which description best fits accrual basis accounting?
• How is WACC defined?
• Which item is included in Enterprise Value but not in Equity Value?
• Which components compose the statutory tax rate in the US?
• When the market value of an investment increases, which accounting method recognizes the gain in the income statement?
• In forecasting intangible assets, Ending Intangibles equals Beginning Intangibles plus Purchases minus Amortization. Which expression correctly represents Ending Intangibles?
• Which of the following are considered dilutive instruments?
• Indefinite-life intangibles are tested for impairment how often?
• For private company deals, what is typically published?
• For Absolute Valuation, what is the main method used to derive Enterprise Value?
• Which of the following is not a step in a typical discounted cash flow (DCF) valuation?
• Which of the following best describes intangible assets?
• Which statement best defines NBV?
• Which statement best describes cash flow from financing activities?
• Which statement correctly defines goodwill?
• Which statement is true about OCI?
• Current assets are assets that are expected to be
• Which of the following is typically classified as a current asset?
• In the building multiples grid, multiples tend to what as earnings grow?
• Which sequence correctly derives the Implied Share Price from Enterprise Value?
• Which shares are excluded from free float?
• WACC is applied on which basis in a DCF?
• Which statement describes cash accounting in contrast to accrual accounting?
• Which statement is consistent with the material on growth, returns, and multiples?
• Maximum number of shares that a company can issue, as specified in the firm's memorandum of association?
• Which of the following statements about common shares is true?
• APIC adjustment for share issuances is calculated as which of the following?
• What is a risk of high accounts payable relative to cash flow?
• Which pair of multiples is commonly used to compare enterprise value and equity value?
• Which is an example of a non-core asset?
• Which statement best explains accounts payable?
• In the Gordon growth model, which statement is correct?
• Which statement best describes the secondary market?
• Which of the following is a current liability?
• RSUs in diluted EPS calculations are treated as what?
• Which formula correctly unleverages beta?
• Which balance sheet component represents goods purchased or produced for sale to customers?
• The borrowing limit of an RCF depends on a company's
• Issued share capital less the par value of shares that are held in the company's treasury?
• Price-to-Book Value is typically used for which types of companies?
• In mid-year cash flow timing, what is the discount exponent used for the first cash flow (FCF1)?
• Debt to Equity is a leverage ratio that measures the relationship between debt funding and owner funding.
• Which of the following statements about the primary market is true?
• Which formula correctly defines Inventory Days in the working capital days ratios?
• When calculating diluted shares, which items contribute to net new shares?
• Over how many years are explicit FCFs typically forecast in a standard DCF?
• Which is the first step in calculating diluted equity value using the treasury method?
• Net working capital is defined as
• Net PPE is calculated as which of the following?
• BASE Analysis for forecasting uses which sequence?
• Which of the following is NOT a tangible asset?
• How is Net Debt defined in financial analysis?
• Which of the following is classified under Operating Activities in the cash flow statement?
• Which statement describes the terminal value via the multiple method?
• Common shares are best described as
• APIC (Additional Paid In Capital) is equal to which of the following?
• Which of the following is a tangible asset?
• If OWC is positive, what does it imply?
• Which risk factor is most commonly the trigger for a corporate default?
• Net Book Value represents what on an asset?
• What adjustment converts Dirty Net Income to Cleaned Net Income?
• Which formula correctly calculates net debt?
• In converting Equity Value to Enterprise Value, which item is added to Equity Value?
• Which statement describes a typical steady-state characteristic in DCF valuation?
• What does a balance sheet snapshot show?
• What is the purpose of precedent transactions in valuation?
• What does the matching concept aim to achieve?
• Prepaid expenses are expenses that have been incurred where the service has not yet been earned/delivered. Which items are typical prepaid expenses?
• Which statement correctly describes marginal tax rate (MTR) and effective tax rate (ETR)?
• What is a primary reason to normalize earnings when selecting comps?
• An estimated supplier bill that is unpaid and covers the current period is recorded as which type of liability?
• Which of the following is a current asset?
• In calculating transaction multiples, which is a common value driver?
• Which balance sheet item is revenues collected in advance for services not yet performed?
• How is Enterprise Value related to Equity Value and Net Debt?
• Under accrual basis accounting, revenue is recognized when it is earned.
• What is the recommended approach to the capital asset turnover ratio over time?
• When discounting synergies, which combination of rate and perpetual growth is used?
• ETR is defined as which ratio?
• A complete list of items such as property, goods in stock, or the contents of a building?
• Which balance sheet item represents the portion of a loan that must be paid within the next 12 months?
• What modeling practice is described as discouraged in the notes?
• Common stock class A vs B differences primarily relate to?
• What is the formula for working capital?
• In the WACC equation WACC = Ke*(E/(E+D)) + Kd*(1-MTR)*(D/(E+D)), what does D represent?
• In steady-state projections, how is long-term growth typically characterized relative to inflation?
• As of December 31, 2021, what was the weighted-average remaining contractual life of outstanding stock options (in years)?
• According to the material, which approach should the WACC calculation base on?
• What does Beta measure?
• Which formula best defines Enterprise Value (EV)?
• Cash sweep refers to
• When using a growth perpetuity to calculate TV under mid-year timing, where is TV incorporated in the cash flow timeline?
• Which statement is true about PV vs NPV functions?
• In the notes, the term 'Cleaning' EBITDA is said to correspond to which metric?
• In terminal value using a growing perpetuity, which formula represents value?
• Which long-term debt type is typically amortizing?
• APIC is also known as?
• When cleaning Net Income for EPS or P/E, which tax rate should you use if uncertain?
• Which items are included in Net Operating Assets (NOA)?
• Amounts to be paid in the future for goods or services already acquired?
• Which of the following is a tangible non-current asset example?
• Do preferred shares usually have voting rights?
• Which instrument is typically a short-term debt instrument?
• A source of contributed capital that can result from certain types of equity transactions, including the reacquisition of shares.
• What is the key idea of the First Principles approach to forecasting PP&E and D&A?
• Which component of a DCF is highly sensitive to the underlying assumptions?
• Which of the following is included in current assets?
• Which instrument is a short-term revolving credit facility?
• What does aggregate intrinsic value represent in the context of stock options?
• Which statement about EBITDA is true?
• What are outstanding shares?
• Which equation correctly defines outstanding shares?
• Which of the following is true about accrued expenses in accrual accounting?
• Which statement about GAAP depreciation is correct?
• Under US GAAP, operating leases are generally treated as:
• What is the main purpose of using the capital asset turnover ratio in PP&E forecasting?
• Which off-balance-sheet items may be reflected in the market value of net operating assets?
• Which function is used for regular, equal payments in time-value calculations?
• Retained earnings represent what in a corporation?
• EBITDA-based leverage can be measured by which ratio?
• Goodwill, in general terms, refers to…
• Notes payable vs bonds maturity: which statement is true?
• Unearned Revenue is described as
• What are intangible assets?
• True or false: The number of authorized shares can be significantly higher than the issued shares.
• Which of the following is a current asset?
• What does Gross PPE represent on the balance sheet?
• Which statement about preferred shares is true?
• Which statement best describes accrual accounting?
• What does WACC represent in DCF analysis?
• Free Cash Flow is calculated as EBIT*(1-Tax) + Depreciation - Capital Expenditure - Net Working Capital. Which option matches this formula?
• Issued shares refer to which of the following?
• Which item is defined as an intangible asset?
• After cleaning, which statement best describes continuing income in Net Income?
• When should revenue be recognized under accrual accounting?
• EBIT is commonly used as another name for which measure?
• What best describes a revolving credit facility (RCF)?
• Which statement describes speculative-grade credit risk?
• Which input does the Terminal Value via the multiple method rely on?
• Which formula defines A/P Days according to the material?
• If Net Income is 0.20 of Net Sales, which value above represents the Profit Margin?
• Which item is NOT included in the Free Cash Flow calculation?
• Net working capital is a measure of a firm’s
• Net income is defined as which of the following?
• What is the formula for straight-line depreciation?
• A debt schedule typically includes which items?
• Which statement describes changes in stockholders' equity not caused by owner transactions?
• What does COGS focus on in relation to sold items?
• Stock options are typically granted to a wide employee base with no exercise price.
• Which depreciation method is based on asset usage rather than time?
• Which description best defines deferred income taxes?
• In the described framework, what does a negative working capital cycle imply?
• What characterizes the Quick & Simple D&A Forecast approach?
• Which of the following is not a current asset?
• Which short-term debt facility is a very short revolver used to support seasonality by enabling temporary increases in assets?
• NOPAT stands for:
• What is the formula for Net Book Value (NBV)?
• Which Excel function returns the smallest value from a set of numbers?
• In valuation discussions, which statement best describes the relationship between minority stake price and control premium?
• PPE stands for which category?
• Under finance or capital leases, how is the lease treated on the balance sheet?
• Which method allocates equal amounts of plant asset net cost to depreciation over its useful life?
• Forecast FCF are unlevered; which term describes this?
• The treasury stock method is primarily used to quantify what aspect of a company's capital structure?
• How does inflation impact capex versus depreciation in forecasting?
• What was the control premium and how much value was created/destroyed given the data: unaffected share price 12, bid price 16, fully diluted shares 10m, PV of synergies 100m?
• Which metric is the most common value driver in transaction comps?
• Which statement describes the accumulated profits and losses since inception, with retained deficit if losses exceed profits?
• In WACC calculation, should you use market values or book values for equity and debt?
• Deferred income tax assets (expected to reverse in 12 months) reflect?
• What is the primary purpose of a football field chart in valuation?
• Accounts payable are?
• Which items are included in Debt & Debt Equivalents for EV calculations?
• Converting a US GAAP operating lease to IFRS requires which of the following changes? (IS and BS effects)
• What is accrued expenses?
• Cleaning NI is used for calculating which metrics?
• What does a cash sweep or debt waterfall refer to?
• If a bond held as FVOCI increases in market value and is not sold, where is the gain reflected?
• A decline in the investment balance between two periods is most often explained by which of the following?
• Which item is included in intangible assets according to the material?
• Which term describes the maximum number of shares a company can issue?
• Accrual basis accounting matches expenses to the revenues they helped produce.
• What does the perpetuity method assume in terminal value calculation?
• What condition must hold for the growing perpetuity terminal value formula to yield a finite value?
• How do you derive the share price from equity value in the valuation bridge?
• What does straight-line debt repayment mean?
• Which statement about depreciation and cash flow is true?
• In the treasury stock method, net dilution occurs only if the stock price exceeds the strike. Which statement is true?
• Outstanding share capital equals issued share capital minus the par value of shares held in treasury.
• Which accounting system records revenues and expenses only when cash is received or paid?
• When building trading comps, what is the typical approach to earnings used for multiples?
• Which balance sheet component would reflect the company's net earnings accumulated over time after distributions?
• Capital expenditures are typically shown in which financial statement?
• Which set reflects the components of equity on the balance sheet?
• Under accrual accounting, when is revenue recognized?
• What is the depreciation formula under the straight-line method?
• Can the issued (outstanding) shares exceed the number of authorized shares?
• Which rights do common shareholders typically have?
• The quantity of goods that a firm has on hand?
• If OWC has decreased between two periods, what does this indicate about cash?
• For a public M&A deal, which item is listed as required information?
• Which statement about the basis for depreciation calculation is correct?