Bedrijfseconomie Accounting & Control Research (BA
Summary
Samenvatting Bedrijfseconomie Accounting & Control Research (BA
52 views 4 purchases
Course
Bedrijfseconomie Accounting & Control Research (BA
Institution
Vrije Universiteit Amsterdam (VU)
Een complete samenvatting van dit vak die jou goed voorbereid op het tentamen. De samenvatting bevat eveneens afbeeldingen en linkjes naar youtube filmpjes ter ondersteuning van de samenvatting.
cost of debt cost of equity capm sml stock market derivates expected return
Written for
Vrije Universiteit Amsterdam (VU)
Accountancy&Control
Bedrijfseconomie Accounting & Control Research (BA
All documents for this subject (1)
Seller
Follow
kareltjee
Reviews received
Content preview
BUSINESS ECONOMICS FOR ACCOUNTING
(Bedrijfseconomie voor Accounting en Control Research - BACR)
,Inhoud
Financial Leverage..................................................................................................................................5
Degree of Financial leverage (DFL).........................................................................................................5
Degree of Operating Leverage (DOL)?....................................................................................................5
Other Comprehensive Income................................................................................................................7
Cash(flow) transactions: Operations, investing and financing................................................................8
Retained earnings.................................................................................................................................10
Liquidity ratios..................................................................................................................................12
Debt ratios........................................................................................................................................13
The profitability ratios......................................................................................................................13
The market ratios.............................................................................................................................13
Time value of money............................................................................................................................16
Future value lump-sum.....................................................................................................................17
Present value lump sum...................................................................................................................17
Future value Annuity........................................................................................................................18
Present value Annuity.......................................................................................................................18
Present value uneven cashflow stream............................................................................................19
Perpetuities - PVP (eeuwigdurende betaling)...................................................................................19
Discounting and Risk.........................................................................................................................19
Annual/Semiannual compounding...................................................................................................20
Cost of money......................................................................................................................................21
Components of interest rate................................................................................................................22
Bonds....................................................................................................................................................23
Bond Rating......................................................................................................................................24
Relationships in bonds value............................................................................................................25
When Market Interest Rates Increase..........................................................................................25
When Market Interest Rates Decrease.........................................................................................25
Relationship Between Market Interest Rates and a Bond's Market Value...................................25
How Are Coupon Rates Affected by Market Interest Rates?........................................................26
Stocks...................................................................................................................................................26
Difference between bonds and stocks..............................................................................................26
Stock valuation.................................................................................................................................27
Dividend Discount Model (DDM)..................................................................................................27
Constant.......................................................................................................................................27
Variable or Nonconstant Growth Dividend Discount Model........................................................29
, Calculate rate of return constant growth.........................................................................................31
Derivatives............................................................................................................................................32
Swap.................................................................................................................................................32
Interest Rate Swaps......................................................................................................................32
Risks and rate of return........................................................................................................................33
Standard deviation...........................................................................................................................34
Example calculation standard deviation:......................................................................................34
Coefficient of variation (CV)..............................................................................................................34
Portfolio (diversification)..................................................................................................................35
Expected return on a portfolio.....................................................................................................35
Correlation coefficient..................................................................................................................36
(Non-) diversifiable risk.................................................................................................................36
Beta......................................................................................................................................................37
The Capital Asset Pricing Model (CAPM)..............................................................................................37
Security Market Line (SML)...............................................................................................................37
Disadvantages of CAPM....................................................................................................................38
Capital budgeting.................................................................................................................................39
Replacement / expensation decision................................................................................................39
Classification projects.......................................................................................................................39
Methods...........................................................................................................................................39
Present Value................................................................................................................................39
Internal rate of return (IRR)..........................................................................................................40
Payback Analysis...........................................................................................................................41
Discounted payback......................................................................................................................41
Relevant Cashflows...........................................................................................................................42
Components incremental cashflows.............................................................................................43
Sensitivity Analyse............................................................................................................................47
WACC................................................................................................................................................48
The cost of capital................................................................................................................................48
Cost of Debt......................................................................................................................................48
Cost of Equity...................................................................................................................................49
Cost of Equity : preferred stock....................................................................................................50
Cost of Equity : Retained Earnings................................................................................................50
Cost of Equity : New equity..........................................................................................................51
WACC................................................................................................................................................52
Example........................................................................................................................................53
, Marginal cost of capital....................................................................................................................53
Example 1.....................................................................................................................................54
Example 2.....................................................................................................................................55
Uses..............................................................................................................................................56
MCC Schedule...............................................................................................................................56
Capital structure...................................................................................................................................58
Influences.........................................................................................................................................58
Minimizing WACC.............................................................................................................................59
EPS/EBIT analyse..............................................................................................................................60
Theory 1: Modigliani-Miller Theorem...............................................................................................60
Theory 2: Signaling Theory...............................................................................................................61
Pecking Order Theory.......................................................................................................................62
Static trade-off theory......................................................................................................................62
Dividends policy....................................................................................................................................63
Appendix: Formulas..............................................................................................................................64
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller kareltjee. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $7.50. You're not tied to anything after your purchase.
