cob241.com Formula Sheet
| Assets = Liabilities + Shareholder's Equity (Or Owner's Equity) |
| Contributed Capital |
| + Retained Earnings |
| Shareholder's Equity (or Owner's Equity) |
| Beginning RE |
| + Net Income |
| – Dividends |
| Ending RE |
| Revenues |
| – Expenses |
| Net Income |
| Sales |
| – COGS |
| Gross Profit |
| – Operating Expenses |
| Total Income From Operations |
| – Non-Operating Expenses |
| Income Before Taxes |
| – Tax Expense |
| Net Income |
| (This is the Multi-Step Income statement) |
| Operating Cash Flows |
| + Investing Cash Flows |
| + Financing Cash Flows |
| Net Increase (Decrease) in Cash |
| + Beg Balance Cash |
| Ending Cash Balance |
| Current Ratio = Current Assets / Current Liabilities |
| Working Capital = Current Assets – Current Liabilities |
| Profit Margin = Net Income / Sales Revenue |
| Sales |
| – COGS |
| Gross Profit |
| Gross Profit Margin = Gross Profit / Sales Revenue |
| Gross Profit Ratio is the same as Gross Profit Margin |
| Beginning Inventory |
| + Net Purchases |
| – Ending Inventory |
| COGS |
| Beginning Inventory |
| + Net Purchases |
| – COGS |
| Ending Inventory |
| Beginning Inventory |
| + Net Purchases |
| Goods Available for Sale (Some professors care about this... some don't) |
| Sales Revenue |
| – Sales Returns and Allowances |
| – Sales Discounts |
| Net Sales |
| Purchases |
| – Purchase Returns and Allowances |
| – Purchase Discounts |
| Net Purchases |
| + Transportation In |
| Cost of Goods Purchased |
| Total Credit Sales |
| – Sales Returns and Allowances |
| – Sales Discounts |
| Net Credit Sales |
| Ending Allowance for Bad Debts = Ending A/R * Estimated % |
| (Balance Sheet Method) |
| Bad Debt Expense = Net Credit Sales * Estimated % |
| (Income Statement Method) |
| Accounts Receivable |
| – Allowance for Bad Debts (or Allowance for Uncollectible Accounts) |
| Net Realizable Value (or Net Accounts Receivable) |
| Face Value |
| * Annual Percentage Rate |
| * (Months Outstanding / 12) You could use (Days Outstanding / 360) instead of months |
| Interest Expense (or Revenue) |
| Maturity Value = Principal + Interest |
| Depreciable Base = Cost - Salvage Value |
| Straight Line Depreciation Expense = Depreciable Base / Useful Life |
| Assets |
| – Accumulated Depreciation |
| Book Value |
| DDB Depreciation Expense = 2 * (1 / Useful Life) * Book Value |
| When using DDB, make sure you don't depreciate more than the depreciable base! |
| Units of Production Depreciation Expense = Units Produced * (Depreciable Base / Total Expected Units) |
| This is not different than straight line, except that instead of "years", we're using "units". |
| Partial Year Depreciation Expense = SL or DDB Full Year Expense * Months In Service / 12 |
| When using units of production, there is no "partial year" formula, since UoP is not time based in the first place. |
| Purchase Price of Asset = Purchase Price of Group * (FMV of Asset / FMV of Whole Group) |
| Lump Sum Purchases are also called Basket Purchases, or Group Purchases |
| Future Amount |
| * PV$1(i, n) (Look this up in the PV$1 Table) |
| Present Value of a Lump Sum |
| Payment Amount |
| * PVOA(i, n) (Look this up in the PVOA Table) |
| Present Value of an Ordinary Annuity |
| Bond Face Value |
| + Unamortized Premium |
| – Unamortized Discount |
| Bond Carrying Value |
| Bond Payment Amount = Face Value of the Bond * Annual Coupon Rate / # of Payments Per Year |
| If a bond pays semi-annually, then there are two payments per year. If it's annual, then it's just 1 payment per year. |
| Bond Interest Expense = Carrying Value * Market Interest Rate |
| Bond Face Value * PV$1(i,n) |
| + Payment Amount * PVOA(i,n) |
| Bond Selling Price |
| When calculating the selling price, be sure to use the Market Rate for i. |
| Cash Out |
| – Cash In |
| Cost of Borrowing (Bonds) |
| Cash Payments |
| – Premium |
| + Discount |
| Cost of Borrowing (Bonds) |
| Bond Carrying Value |
| – Cash Paid to Retire |
| Gain / Loss on Retirement of Bond |
| Net Income |
| + Depreciation / Amortization |
| – Gain on PPE |
| + Loss on PPE |
| + Decrease in CA |
| + Increase in CL |
| – Increase in CA |
| – Decrease in CA |
| Cash from Operations |
| Cash Receipts from Sale of PPE |
| + Cash Receipts from Sale of Investment |
| + Cash Receipts from Collection of Loan |
| – Cash Payments for Purchase of PPE |
| – Cash Payments for Purchase of Investment |
| – Cash Payments for Making of Loan |
| Cash from Investing |
| Cash Receipts from Issuance of Bonds |
| + Cash Receipts from Issuance of Stock |
| – Cash Payments for for Long Term Debt (Bonds) (Principle only) |
| – Cash Payments for Purchase of Treasury Stock |
| – Cash Payments for Cash Dividends |
| Cash from Financing |