Chapter Summary 2 – Corporate Finance
Please go through the attached presentations of Chapters 3 and 4, read the Corporate Finance textbook to write a summary of the assigned chapters in no less than three pages.
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Chapter 3: Financial Statements Analysis and Financial Models
Financial statement analysis can be done either through common-size balance sheets and common size income statements.
Standardized statements are good for: comparing financial information, comparing companies of different sizes, especially within the same county
Common size Income statement measurements commonly used by analyst and investors
Net Income=Revenues minus expenses.
EPS = Earnings per share (net income/number of common stock shares outstanding)
EBIT = Earnings before interest and taxes (income from operations).
EBITDA = Earnings before interest, taxes, depreciation and amortization.
Financial statement analysis can be done either through common-size balance sheets and common size income statements.
Standardized statements are good for: comparing financial information, comparing companies of different sizes, especially within the same county
Common size Income statement measurements commonly used by analyst and investors
Net Income=Revenues minus expenses.
EPS = Earnings per share (net income/number of common stock shares outstanding)
EBIT = Earnings before interest and taxes (income from operations).
EBITDA = Earnings before interest, taxes, depreciation and amortization.
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