罗斯公司理财-Chap002ppt课件.ppt

FinancialStatementsandCashFlow Chapter2 Copyright 2011byTheMcGraw HillCompanies Inc Allrightsreserved McGraw Hill Irwin UnderstandtheinformationprovidedbyfinancialstatementsDifferentiatebetweenbookandmarketvaluesKnowthedifferencebetweenaverageandmarginaltaxratesGraspthedifferencebetweenaccountingincomeandcashflowCalculateafirm scashflow KeyConceptsandSkills 2 1TheBalanceSheet2 2TheIncomeStatement2 3Taxes2 4NetWorkingCapital2 5FinancialCashFlow2 6TheAccountingStatementofCashFlows ChapterOutline 2 1TheBalanceSheet Anaccountant ssnapshotofthefirm saccountingvalueataspecificpointintimeTheBalanceSheetIdentityis Assets Liabilities Stockholders Equity Assetsexactlyequalliabilities equityAssetsarelistedinorderofliquidityTheamountoftimeitwouldtaketoconvertthemtocashinanoperatingbusinessObviouslycashandA Raremoreliquidthanpropertyplantandequipment Liabilitiesarelistedintheorderinwhichtheycomedue TakeNotice onthefollowingBalanceSheet U S CompositeCorporationBalanceSheet 2008 2007 2008 2007 Currentassets CurrentLiabilities Cashandequivalents 140 107 Accountspayable 213 197 Accountsreceivable 294 270 Notespayable 50 53 Inventories 269 280 Accruedexpenses 223 205 Other 58 50 Totalcurrentliabilities 486 455 Totalcurrentassets 761 707 Long termliabilities Fixedassets Deferredtaxes 117 104 Property plant andequipment 1 423 1 274 Long termdebt 471 458 Lessaccumulateddepreciation 550 460 Totallong termliabilities 588 562 Netproperty plant andequipment 873 814 Intangibleassetsandother 245 221 Stockholder sequity Totalfixedassets 1 118 1 035 Preferredstock 39 39 Commonstock 1pervalue 55 32 Capitalsurplus 347 327 Accumulatedretainedearnings 390 347 Lesstreasurystock 26 20 Totalequity 805 725 Totalassets 1 879 1 742 Totalliabilitiesandstockholder sequity 1 879 1 742 Whenanalyzingabalancesheet theFinanceManagershouldbeawareofthreeconcerns AccountingliquidityDebtversusequityValueversuscost BalanceSheetAnalysis Referstotheeaseandquicknesswithwhichassetscanbeconvertedtocash withoutasignificantlossinvalueCurrentassetsarethemostliquid Somefixedassetsareintangible Themoreliquidafirm sassets thelesslikelythefirmistoexperienceproblemsmeetingshort termobligations Liquidassetsfrequentlyhavelowerratesofreturnthanfixedassets AccountingLiquidity Creditorsgenerallyreceivethefirstclaimonthefirm scashflow Shareholders equityistheresidualdifferencebetweenassetsandliabilities Debtandequityhavedifferentcosts therelationshipbetweenthemhasimpactonthefirm sprofitability DebtversusEquity UnderGenerallyAcceptedAccountingPrinciples GAAP financialstatementsoffirmsintheU S carryassetsathistoricalcost Marketvalueisthepriceatwhichtheassets liabilities andequitycouldactuallybeboughtorsold whichisacompletelydifferentconceptfromhistoricalcost ValueversusCost MeasuresfinancialperformanceoveraspecificperiodoftimeTheaccountingdefinitionofincomeis Revenue Expenses Income 2 2TheIncomeStatement U S C C IncomeStatement Totaloperatingrevenues Costofgoodssold Selling general andadministrativeexpenses Depreciation Operatingincome Otherincome Earningsbeforeinterestandtaxes Interestexpense Pretaxincome Taxes Current 71 Deferred 13 Netincome Additiontoretainedearnings 43 Dividends 43 Theoperationssectionoftheincomestatementreportsthefirm srevenuesandexpensesfromprincipaloperations 2 262 1 655 327 90 190 29 219 49 170 84 86 U S C C IncomeStatement Totaloperatingrevenues 2 262 Costofgoodssold 1 655 Selling general andadministrativeexpenses 327 Depreciation 90 Operatingincome 190 Otherincome 29 Earningsbeforeinterestandtaxes 219 Interestexpense 49 Pretaxincome 170 Taxes 84 Current 71 Deferred 13 Netincome 86 Additiontoretainedearnings 43 Dividends 43 Thenon operatingsectionoftheincomestatementincludesallfinancingcosts suchasinterestexpense U S C C IncomeStatement Totaloperatingrevenues Costofgoodssold Selling general andadministrativeexpenses Depreciation Operatingincome Otherincome Earningsbeforeinterestandtaxes Interestexpense Pretaxincome Taxes Current 71 Deferred 13 Netincome Retainedearnings 43 Dividends 43 Netincomeisthe bottomline 2 262 1 655 327 90 190 29 219 49 170 84 86 Therearethreethingstokeepinmindwhenanalyzinganincomestatement GenerallyAcceptedAccountingPrinciples GAAP NoncashItemsTimeandCosts IncomeStatementAnalysis ThematchingprincipalofGAAPdictatesthatrevenuesbematchedwithexpenses Thus incomeandexpensesarereportedwhenearnedorincurred eventhoughnocashflowmayhaveoccurred GAAP Depreciationisthemostapparentnon cashitem Nofirmeverwritesacheckfor depreciation Othernoncashaccountsincludeuncollectedsalesonaccount unpaidpurchasesonaccountanddeferredtaxes noneofwhichrepresentacashflowThus netincomedoesnotequalcashflow NoncashItems Thinkofthefutureashavingtwoparts shortrunandlongrunIntheshortrunsomecostsarefixedandothersvariable Intheshortrunequipmentandcommitmentsarefixed ProductioncanonlybevariedbyalteringlaborandmaterialsInthelongrunallcostsarevariable TimeandCosts FinancialaccountantsdonotdistinguishbetweenvariablecostsandfixedcostsAccountingcostsareusuallytreatedasperiodorproductcostsProductCosts Totalproductioncostsi e rawmaterials directlabor manufacturingoverheadPeriodCosts Costsallocatedtoatimeperiodi e selling generalandadministrativecostsSuchasaccountantsalaries officesupplies CostsandPurpose 2 3Taxes Taxesimpactincome importanttofinancialdecisionsTaxescomefromvarioussources Federal state exciseTaxesarealwayschangingMarginalvs averagetaxratesMarginal thepercentagepaidonthenextdollarearnedAverage thetaxbill taxableincomeFinancialdecisionsareincremental applicabletaxrateisthemarginalrateOthertaxes Supposeyourfirmearns 4millionintaxableincome Whatisthefirm staxliability Whatistheaveragetaxrate Whatisthemarginaltaxrate Ifyouareconsideringaprojectthatwillincreasethefirm staxableincomeby 1million whattaxrateshouldyouuseinyouranalysis MarginalversusAverageTaxRates NetWorkingCapital CurrentAssets CurrentLiabilitiesNWCusuallygrowswiththefirm 2 4NetWorkingCapital U S C C BalanceSheet 2008 2007 2008 2007 Currentassets CurrentLiabilities Cashandequivalents 140 107 Accountspayable 213 197 Accountsreceivable 294 270 Notespayable 50 53 Inventories 269 280 Accruedexpenses 223 205 Other 58 50 Totalcurrentliabilities 486 455 Totalcurrentassets 761 707 Long termliabilities Fixedassets Deferredtaxes 117 104 Property plant andequipment 1 423 1 274 Long termdebt 471 458 Lessaccumulateddepreciation 550 460 Totallong termliabilities 588 562 Netproperty plant andequipment 873 814 Intangibleassetsandother 245 221 Stockholder sequity Totalfixedassets 1 118 1 035 Preferredstock 39 39 Commonstock 1parvalue 55 32 HereweseeNWCgrowto 275millionin2008from 252millionin2007 Thisincreaseof 23millionisaninvestmentofthefirm Infinance themostimportantitemthatcanbeextractedfromfinancialstatementsistheactualcashflowofthefirm Cashflowreceivedfromthefirm sassetsmustequalthecashflowstothefirm screditorsandstockholders CF A CF B CF S Inotherwords thecashgeneratedbyassetsenablesthefirmtopayitsdebtsandprovideareturntoshareholders Accountingcashflowandfinancialcashflowarenotnecessarilyequal 2 5FinancialCashFlow U S C C FinancialCashFlow CashFlowoftheFirm Operatingcashflow 238 Earningsbeforeinterestandtaxes plusdepreciationminustaxes Capitalspending 173 Acquisitionsoffixedassets minussalesoffixedassets Additionstonetworkingcapital 23 Total 42 CashFlowofInvestorsintheFirm Debt 36 Interestplusretirementofdebt minuslong termdebtfinancing Equity 6 Dividendsplusrepurchaseof equityminusnewequityfinancing Total 42 OperatingCashFlow EBIT 219Depreciation 90CurrentTaxes 71OCF 238 U S C C FinancialCashFlow CashFlowoftheFirm Operatingcashflow 238 Earningsbeforeinterestandtaxes plusdepreciationminustaxes Capitalspending Acquisitionsoffixedassets minussalesoffixedassets Additionstonetworkingcapital Total CashFlowofInvestorsintheFirm Debt Interestplusretirementofdebt minuslong termdebtfinancing Equity Dividendsplusrepurchaseof equityminusnewequityfinancing Total CapitalSpendingPurchaseoffixedassets 198Salesoffixedassets 25CapitalSpending 173 173 23 42 36 6 42 U S C C FinancialCashFlow CashFlowoftheFirm Operatingcashflow 238 Earningsbeforeinterestandtaxes plusdepreciationminustaxes Capitalspending Acquisitionsoffixedassets minussalesoffixedassets Additionstonetworkingcapital Total CashFlowofInvestorsintheFirm Debt Interestplusretirementofdebt minuslong termdebtfinancing Equity Dividendsplusrepurchaseof equityminusnewequityfinancing Total NWCgrewfrom 275millionin2006from 252millionin2005 Thisincreaseof 23millionistheadditiontoNWC 173 23 42 36 6 42 U S C C FinancialCashFlow CashFlowoftheFirm Operatingcashflow 238 Earningsbeforeinterestandtaxes plusdepreciationminustaxes Capitalspending Acquisitionsoffixedassets minussalesoffixedassets Additionstonetworkingcapital Total CashFlowofInvestorsintheFirm Debt Interestplusretirementofdebt minuslong termdebtfinancing Equity Dividendsplusrepurchaseof equityminusnewequityfinancing Total CashFlowtoCreditorsInterest 49Retirementofdebt73Debtservice122Proceedsfromnewdebtsales 86Total 36 173 23 42 36 6 42 U S C C FinancialCashFlow CashFlowoftheFirm Operatingcashflow 238 Earningsbeforeinterestandtaxes plusdepreciationminustaxes Capitalspending Acquisitionsoffixedassets minussalesoffixedassets Additionstonetworkingcapital Total CashFlowofInvestorsintheFirm Debt Interestplusretirementofdebt minuslong termdebtfinancing Equity Dividendsplusrepurchaseof equityminusnewequityfinancing Total CashFlowtoStockholdersDividends 43Repurchaseofstock6CashtoStockholders49Proceedsfromnewstockissue 43Total 6 173 23 42 36 6 42 U S C C FinancialCashFlow CashFlowoftheFirm Operatingcashflow 238 Earningsbeforeinterestandtaxes plusdepreciationminustaxes Capitalspending Acquisitionsoffixedassets minussalesoffixedassets Additionstonetworkingcapital Total CashFlowofInvestorsintheFirm Debt Interestplusretirementofdebt minuslong termdebtfinancing Equity Dividendsplusrepurchaseof equityminusnewequityfinancing Total Thecashflowreceivedfromthefirm sassetsmustequalthecashflowstothefirm screditorsandstockholders 173 23 42 36 6 42 ThereisanofficialaccountingstatementcalledtheStatementofCashFlows Thishelpsexplainthechangeinaccountingcash whichforU S Compositeis 33millionin2008 Thethreecomponentsofthestatementofcashflowsare CashflowfromoperatingactivitiesCashflowfrominvestingactivitiesCashflowfromfinancingactivities 2 5TheStatementofCashFlows U S C C CashFlowfromOperations Tocalculatecashflowfromoperations startwithnetincome addbacknoncashitemslikedepreciationandadjustforchangesincurrentassetsandliabilities otherthancash Operations NetIncome Depreciation DeferredTaxes ChangesinCurrentAssetsandLiabilities Accou