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FIN3201 (F) Formula Sheet JAN2015
FIN3201 (F) Formula Sheet JAN2015
FIN3201 (F) Formula Sheet JAN2015
Ratio
Current ratio = Total asset turnover = Sales/Total assets
Current assets/Current liabilities
Return on equity =
Net income /Common equity
FV = PMT [(1+i)n – 1 / i]
PV = PMT [{1 – 1/(1+i)n} /i]
FV = PMT [(1+i)n -1/i](1+i)
PV = PMT [1- 1/(1+i)n]/i (1+i)
1
Risk and Return
n
E ( R) pRi 1
i i
n
σ 2 pi ( Ri E ( R)) 2
i 1
m
E ( RP ) w j E ( R j )
j 1
Bond Valuation
Stock Valuation
Vcs= Present Value of (dividend + expected price)
= (D1 + P1)/1+k
Vcs = D0(1+g)/r-g
Cost of Capital
Kd = Yield (1-Tax rate)
Kps= Dps/Pps
Kcs = rf + β(rm-rf)
Kcs = (D1/ Pcs) + g
WACC = (kd x wd) + (kcs x wcs) + (kps x wps)
2
Capital Budgeting
NPV = CF1/(1+k)1 + CF2/(1+k)2 + ……. + CFn/(1+k)n - CF0