Balance sheet assumptions - Study guides, Class notes & Summaries

WGU C213 Topic Five Study Guide Questions and Answers 100% Pass Cash flows are partitioned into three categories... - ANSWER -operating (most important) investing (second most important) financing (third most important) (also have to include non-cash investing and financing transactions) the statement of cash flows provides what? - ANSWER -information that is not readily apparent by looking at just the balance sheet and the income statement Operating cash flow is particularly useful in s...

WGU C213 Accounting for Decision Makers ABCD Exam Questions and Answers 100% Pass Accounting - ANSWER -the recording of the day-to-day financial activities of a company and the organization of that information into summary reports used to evaluate the company's financial status Bookkeeping - ANSWER -the preservation of a systematic, quantitative record of an activity accounting system - ANSWER -used by a business to handle routine bookkeeping tasks and to structure the information so i...

What is a leveraged buyout, and why does it work? - ANSWER In a leveraged buyout (LBO), a private equity firm acquires a company using a combination of debt and equity (cash), operates it for several years, possibly makes operational improvements, and then sells the company at the end of the period to realize a return on investment. During the period of ownership, the PE firm uses the company's cash flows to pay interest expense from the debt and to pay off debt principal. An LBO delive...

LBO/PE Interview Prep Exam Questions & Answers Hurdle rate - ANSWER ️️ minimum acceptable rate of return Run me through the changes between the existing balance sheet and the pro forma balance sheet in an LBO model. (8 steps) - ANSWER ️️ 1) Deduct cash used in transaction 2) PP&E Step-up 3)New Identified Tangibles 4) New Goodwill 5) Capitalized financing fees 6) New debt+repayment of old debt 7) Deferred tax liability 8) New common equity Walk me through an LBO analysis - ANS...

Solutions to Questions 8-1 A budget is a detailed quantitative plan for the acquisition and use of financial and other resources over a given time period. Budgetary control involves using budgets to increase the likelihood that all parts of an organization are working together to achieve the goals set down in the planning stage. 8-2 1. Budgets encourage managers to think about and plan for the future. 2. Budgets communicate financial goals throughout the organization. 3. Budget...

American Institute of Certified Public Accountants (AICPA) - Answer-the professional organization of certified public accountants (CPAs) in the United States Public Company Accounting Oversight Board (PCAOB) - Answer-the organization that inspects the audit practices of registered audit firms and has statutory authority to investigate questionable audit practices and to impose sanctions such as barring an audit firm from auditing SEC-registered companies information on the accounting assum...

Intermediate Accounting Exam #1 || With Questions & Solutions (Rated A+) Intermediate Accounting Exam #1 || With Questions & Solutions (Rated A+) According to Statement of Financial Accounting Concepts No. 2, predictive value is an ingredient of the fundamental quality of: Relevance: Faithful Representation: a. yes no b. yes yes c. no no d. no yes - ANSWER - a: yes; no Financial information exhibits the characteristic of consistency when: a. expenses are reposted as charges a...

What is an LBO? - ANSWER In a leveraged buyout, 1) PE firm acquires a company using D + E 2) Operates it for a several years with operating improvements 3) sells it at the end of the period to realize a return on that investment Walk me through the mechanics of an LBO model. - ANSWER 1) Assumptions 2) S&U 3) Adjust Balance Sheet - Debt and Equity - Goodwill 4) Project 3 statements 5) Project FCF 6) Debt and Interest Schedule 7) Exit Calc (MOic and IRR) 8) Sensitivity Tables How d...

LBO/PE Interview Prep Exam Questions & Answers Hurdle rate - ANSWER ️️ minimum acceptable rate of return Run me through the changes between the existing balance sheet and the pro forma balance sheet in an LBO model. (8 steps) - ANSWER ️️ 1) Deduct cash used in transaction 2) PP&E Step-up 3)New Identified Tangibles 4) New Goodwill 5) Capitalized financing fees 6) New debt+repayment of old debt 7) Deferred tax liability 8) New common equity Walk me through an LBO analysis - ANS...

Accounting - An information system that provides reports to users about the economic activities and condition of a business. Accounts Payable - liability created by a purchase on account - reduces the amount owed on a liability Accounts Receivable - claim against the customer in which you had provided a service and were being payed for it - increases assets & stockholder's equity - promises of payment from customers to sellers Accrual Basis of Accounting - - revenues are reported on the...