Financial Analysis 9 Class Course Answers175

Lesson 1: Introduction to Financial Analysis

1. What are the three main types of financial analysis? Descriptive, predictive, and prescriptive
2. What is the purpose of financial analysis? To provide insights into a company's financial health and performance
3. What are the two main approaches to financial analysis? Top-down and bottom-up

Lesson 2: The Income Statement

1. What are the three main sections of the income statement? Operating activities, investing activities, and financing activities
2. What is the difference between revenue and expenses? Revenue is money earned from selling goods or services, while expenses are costs incurred in generating revenue
3. What is net income? Net income is the amount of money a company has left over after paying all its expenses

Lesson 3: The Balance Sheet

1. What are the three main sections of the balance sheet? Assets, liabilities, and equity
2. What is the difference between assets and liabilities? Assets are anything that a company owns, while liabilities are anything that a company owes
3. What is equity? Equity is the residual interest in the assets of the company after deducting its liabilities

Lesson 4: The Cash Flow Statement

1. What are the three main sections of the cash flow statement? Operating activities, investing activities, and financing activities
2. What is the difference between cash flow from operating activities and cash flow from investing activities? Cash flow from operating activities is the cash generated from the company's main business operations, while cash flow from investing activities is the cash generated from the company's investments
3. What is free cash flow? Free cash flow is the cash that a company has left over after paying all its expenses and investing in its business

Lesson 5: Financial Ratios

1. What are financial ratios? Financial ratios are a way of measuring a company's financial performance in relation to other companies
2. What are the five main categories of financial ratios? Liquidity ratios, profitability ratios, solvency ratios, efficiency ratios, and market value ratios
3. What is the difference between a good financial ratio and a bad financial ratio? A good financial ratio is one that indicates that a company is financially healthy, while a bad financial ratio is one that indicates that a company is financially struggling

Lesson 6: Trend Analysis

1. What is trend analysis? Trend analysis is a way of identifying trends in a company's financial statements
2. What are the two main types of trend analysis? Horizontal analysis and vertical analysis
3. What is the difference between horizontal analysis and vertical analysis? Horizontal analysis compares a company's financial statements over time, while vertical analysis compares a company's financial statements to its industry peers

Lesson 7: Benchmarking

1. What is benchmarking? Benchmarking is a way of comparing a company's financial performance to the performance of other companies in the same industry
2. What are the benefits of benchmarking? Benchmarking can help companies identify areas where they can improve their performance
3. How do you do benchmarking? Benchmarking can be done by using financial ratios, industry reports, and other data sources

Lesson 8: Forecasting

1. What is forecasting? Forecasting is a way of predicting a company's future financial performance
2. What are the two main types of forecasting? Qualitative forecasting and quantitative forecasting
3. What is the difference between qualitative forecasting and quantitative forecasting? Qualitative forecasting uses subjective information to make predictions, while quantitative forecasting uses objective data to make predictions

Lesson 9: Valuation

1. What is valuation? Valuation is a way of determining the value of a company
2. What are the three main methods of valuation? Asset-based valuation, income-based valuation, and market-based valuation
3. What is the difference between asset-based valuation, income-based valuation, and market-based valuation? Asset-based valuation values a company based on its assets, income-based valuation values a company based on its earnings, and market-based valuation values a company based on its market capitalization

2024-11-20

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