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Question 360  CFFA

Find Ching-A-Lings Corporation's Cash Flow From Assets (CFFA), also known as Free Cash Flow to the Firm (FCFF), over the year ending 30th June 2013.

Ching-A-Lings Corp
Income Statement for
year ending 30th June 2013
  $m
Sales 100
COGS 20
Depreciation 20
Rent expense 11
Interest expense 19
Taxable Income 30
Taxes at 30% 9
Net income 21
 
Ching-A-Lings Corp
Balance Sheet
as at 30th June 2013 2012
  $m $m
Inventory 49 38
Trade debtors 14 2
Rent paid in advance 5 5
PPE 400 400
Total assets 468 445
 
Trade creditors 4 10
Bond liabilities 200 190
Contributed equity 145 145
Retained profits 119 100
Total L and OE 468 445
 

 

Note: All figures are given in millions of dollars ($m).

The cash flow from assets was:



Question 383  Merton model of corporate debt, real option, option

In the Merton model of corporate debt, buying a levered company's debt is equivalent to buying the company's assets and:



Question 403  PE ratio, no explanation

Which of the following investable assets is the LEAST suitable for valuation using PE multiples techniques?



Question 447  payout policy, corporate financial decision theory

Payout policy is most closely related to which part of a business?



Question 478  income and capital returns

Total cash flows can be broken into income and capital cash flows. What is the name given to the income cash flow from owning shares?



Question 546  income and capital returns, interest only loan, no explanation

Which of the following statements about the capital and income returns of an interest-only loan is correct?

Assume that the yield curve (which shows total returns over different maturities) is flat and is not expected to change.

An interest-only loan's expected:



Question 564  covariance

What is the covariance of a variable X with a constant C?

The cov(X, C) or ##\sigma_{X,C}## equals:



Question 717  return distribution

The below three graphs show probability density functions (PDF) of three different random variables Red, Green and Blue. Let ##P_1## be the unknown price of a stock in one year. ##P_1## is a random variable. Let ##P_0 = 1##, so the share price now is $1. This one dollar is a constant, it is not a variable.

PDF graph

Which of the below statements is NOT correct? Financial practitioners commonly assume that the shape of the PDF represented in the colour:



Question 842  monetary policy, institution

Which Australian institution is in charge of monetary policy?



Question 917  Macaulay duration, duration

Which of the following statements about Macaulay duration is NOT correct? The Macaulay duration: