Cash flow

Portfolio managers who use an immunization strategy frequently takes into account Macaulay duration. The Macaulay Duration of a collection of cash flows is a weighted average of time periods, at which the cash flow occur, where the weights are the present values of cash flows with respect to the sum of the present value of all the cash flows i.e. the value of cash flow at time 0. Macaulay’s Duration is represented by, D: Where Current Bond price…

Financial statements are indispensable analytical tools for any business regardless of size. There are four primary statements (balance sheet, cash flow statement, retained earnings, and income statement) that are reviewed and analyzed on a regular basis that display an organization economic wealth and health. • Balance Sheet – will permit the viewer to determine the net worth of an organization via seeing: o Total assets, debt, and owner/stockholder’s equity • Income Statement – one will…

invest in two different projects, in order to correctly evaluate its projects, it was used three evaluation models and the results is possible to see below: 3.1 Net Present Value (NPV) The Net Present Value (NPV) illustrates the value between future cash flow of an investment and the amount of money invested. According to the NPV was calculated for project D and E (See Appendix), it was showed that both projects have a positive NPV, € 32.43 and € 14.96 respectively. The most interesting…

earning and current cash flow in the assessment of future cash flow. Current earning is define as net income or loss of an entity for the current year. Current earning are the difference between all revenues and expenses on the statement of profit and loss and other comprehensive income. It will presented in statement of financial position until they are transferred into retained earnings. Current cash flow are reported in the statement of cash flow that showing the cash inflow and cash outflow…

purchase new equipment to increase the company’s printing capabilities. Additionally, capital budgeting occurs in three steps, finding the required rate of return via the weighted average cost of capital (WACC), calculating relevant cash flows, and analyzing the cash flows through capital budgeting tools such as the net present value (NPV) and internal rate of return (IRR) (Colorado State University-Global Campus, 2017). Once these steps are completed, the potential financial…

accounting in public sector provides better quality financial information, more comprehensive and increase efficiency. This allows a better way of discharging accountability by extending the assessment of financial performance beyond the application of cash and supports a better decision making by internal management by providing information on the full cost of operations and the resources used to deliver services to the public 1-Revenue and Expense Matching The most fundamental benefits of…

significantly over a period of time, and the IRR method is solely based upon one internal rate of return. Not only that, the basic IRR calculation is completely ineffective when it is evaluating a project with a mixture of multiple positive and negative cash flows. In this case, a single internal rate of return [IRR] cannot possibly be used. IRR is the discount rate that makes a project break even, in the first place. If the market changes its condition over a period of time, this project can…

Cashflows Year | Net Annual Cash Flow | | | | | Cost | (250,000) | | | |…

sales, other operating costs, and tax rates are not affected, and assume that the same depreciation method is used for tax and stockholder reporting purposes.Answer | | | | | Selected Answer: | Companies' cash positions would decline. | Correct Answer: | Companies' cash positions would decline. | | | | | Question 9 4 out of 4 points | | | Which of the following statements is CORRECT?Answer | | | | | Selected Answer: | One way to increase EVA is to…

Using a spreadsheet, financial calculator, or trial and error to find the root of the equation, we find that: IRRNX-20 = 20.34% The IRR criteria implies accepting the NX-20. c. The profitability index is the present value of all subsequent cash flows, divided by the initial investment, so the profitability index of each project is: PINP-30 = ($185,000{[1 – (1/1.15)5 ] / .15 }) / $550,000 PINP-30 = 1.128 PINX-20 = [$100,000 / 1.15 + $110,000 / 1.152 + $121,000 / 1.153 + $133,100 /…