AFM373 Study Guide - Midterm Guide: Corporate Finance, Nopat, Sustainable Development

• School: University of Waterloo
• Department: Accounting & Financial Management
• Course: AFM373
• Professor: Alan Douglas

Document Summary

Corporate objectives, governance structure, takeover threat s. Sustainable growth with bank funding and working capital gap. Interest calculations, working capital management, taxes payable, covenants. Wacc firm level, division level, comparable firms to estimate beta. Capital budgeting (npv analysis, but not excel) and funding. A/r days = (a/r / sales) * 36 5. A/p days = (a/p / purchases) * 36 5. Purchases = cogs + ending inventory beginning inventory. Cost of forgone trade discount = (1/(1 r)) 3 6 5 / ( t p t d ) 1. Where tp = time paid and td = due date for discount. Unlevering b e (constant d/e): b u = b e / (1 + d/e) Relevering b e (constant d/e): b e = b u * (1 + d/e) Unlevering b e (constant d): b u = b e / [1 + (1 t c) * d/e]