Investments Lecture 8

Financial Statement Analysis part of...

• company analysis
• macroeconomic analysis
• industry analysis
• microeconomic analysis

It is NOT one of the three major statements...

• statement of cash-flows
• cost-benefit statement
• income statement
• balance sheet

The Balance Sheet contains...

• stock data.
• flow data.
• profitability data.
• no data at all.

Total Liabilities=

• total assets - shareholders' equity
• total assets + shareholders' equity
• total assets
• neither of these.

The Income Statement is...

• summary of the profitability over a period of time
• about the assets of the company.
• about the cash-flow of the company.
• not needed, we are happy with Elliot-waves.

The responsibility of a firm’s financial managers:

• Human Resources
• Investment Decisions
• Financial Decisions
• Sales Strategy

ROC

• Return on Cost
• Return of Cost
• Return on Capital
• 'n' roll ain't noise pollution.

An increase in Leverage is good for the company if...

• ROA<interest
• ROA>interest
• ROA=interest
• ROE<ROA

EVA (in Investment) is...

• the first name of an important CEO.
• Ethylene Vinyl Acetate
• Energieverwertungsagentur.
• Economic Value Added

The DuPont System is...

• the decomposition of ROA.
• the decomposition of ROE.
• the decomposition of ROC.
• about the world's largest chemical company.