罗斯公司理财第七版课件Ch02

1、mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-0chapter2accounting statementsand cash flowmcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-1chapter outline2.1 the balance sheet2.2 the income stateme

2、nt2.3 net working capital2.4 financial cash flow2.5 the statement of cash flows2.6 summary and conclusionsmcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-2sources of informationannual reportswall street journalinternetnyse ()nasdaq ()text ()secedgar

3、10k & 10q reportsmcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-32.1 the balance sheetan accountants snapshot of the firms accounting value as of a particular date.the balance sheet identity is:assets liabilities + stockholders equitywhen analy

4、zing a balance sheet, the financial manager should be aware of three concerns: accounting liquidity, debt versus equity, and value versus cost.mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-4the balance sheet of the u.s. composite corporation(in $

5、millions)20x2 and 20x1balance sheetu.s. composite corporationliabilities (debt)assets20x220x1and stockholders equity20x220x1current assets:current liabilities: cash and equivalents$140$107 accounts payable$213$197 accounts receivable294270 notes payable5053 inventories269280 accrued expenses223205 o

6、ther5850 total current liabilities$486$455 total current assets$761$707long-term liabilities:fixed assets: deferred taxes$117$104 property, plant, and equipment$1,423$1,274 long-term debt471458 less accumulated depreciation-550-460 total long-term liabilities$588$562 net property, plant, and equipme

7、nt873814 intangible assets and other245221stockholders equity: total fixed assets$1,118$1,035 preferred stock$39$39 common stock ($1 per value)5532 capital surplus347327 accumulated retained earnings390347 less treasury stock-26-20 total equity$805$725total assets$1,879$1,742total liabilities and st

8、ockholders equity $1,879$1,742the assets are listed in order by the length of time it normally would take a firm with ongoing operations to convert them into cash.clearly, cash is much more liquid than property, plant and equipment.mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill compani

9、es, inc. all rights reserved.2-5balance sheet analysiswhen analyzing a balance sheet, the financial manager should be aware of three concerns:1.accounting liquidity2.debt versus equity3.value versus costmcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.

10、2-6accounting liquidity refers to the ease and quickness with which assets can be converted to cash.current assets are the most liquid.some fixed assets are intangible.the more liquid a firms assets, the less likely the firm is to experience problems meetingshort-term obligations.liquid assets frequ

11、ently have lower rates of return than fixed assets.mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-7debt versus equitygenerally, when a firm borrows it gives the bondholders first claim on the firms cash flow.thus shareholders equity is the residual

12、 difference between assets and liabilities.mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-8value versus costunder gaap audited financial statements of firms in the u.s. carry assets at cost.market value is a completely different concept.mcgraw-hill

13、/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-92.2 the income statementthe income statement measures performance over a specific period of time.the accounting definition of income isrevenue expenses incomemcgraw-hill/irwincorporate finance, 7/e 2005 the mcgr

14、aw-hill companies, inc. all rights reserved.2-10u.s.c.c. income statement (in $ millions)20x2income statementu.s. composite corporationtotal operating revenuescost of goods soldselling, general, and administrative expensesdepreciationoperating incomeother incomeearnings before interest and taxesinte

15、rest expensepretax incometaxes current: $71 deferred: $13net income retained earnings: $43 dividends: $43the operations section of the incomestatement reports the firms revenues and expenses from principal operations$2,262- 1,655- 327- 90$19029$219- 49$170- 84$86mcgraw-hill/irwincorporate finance, 7

16、/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-11(in $ millions)20x2income statementu.s. composite corporationtotal operating revenues$2,262cost of goods sold- 1,655selling, general, and administrative expenses- 327depreciation- 90operating income$190other income29earnings before inte

17、rest and taxes$219interest expense- 49pretax income$170taxes- 84 current: $71 deferred: $13net income$86 retained earnings: $43 dividends: $43the non-operating section of the income statement includes all financing costs, such as interest expense.u.s.c.c. income statementmcgraw-hill/irwincorporate f

18、inance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-12(in $ millions)20x2income statementu.s. composite corporationtotal operating revenuescost of goods soldselling, general, and administrative expensesdepreciationoperating incomeother incomeearnings before interest and taxesinter

19、est expensepretax incometaxes current: $71 deferred: $13net income retained earnings: $43 dividends: $43usually a separate section reports as a separate item the amount of taxes levied on income.$2,262- 1,655- 327- 90$19029$219- 49$170- 84$86u.s.c.c. income statementmcgraw-hill/irwincorporate financ

20、e, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-13(in $ millions)20 x2income statementu.s. composite corporationtotal operating revenuescost of goods soldselling, general, and administrative expensesdepreciationoperating incomeother incomeearnings before interest and taxesinterest

21、expensepretax incometaxes current: $71 deferred: $13net income retained earnings: $43 dividends: $43net income is the “bottom line”.$2,262- 1,655- 327- 90$19029$219- 49$170- 84$86u.s.c.c. income statementmcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved

22、.2-14income statement analysisthere are three things to keep in mind when analyzing an income statement:1.gaap2.non cash items3.time and costsmcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-15generally accepted accounting principles1.gaapthe matchin

23、g principal of gaap dictates that revenues be matched with expenses. thus, income is reported when it is earned, even though no cash flow may have occurredmcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-16income statement analysis2.non cash itemsdep

24、reciation is the most apparent. no firm ever writes a check for “depreciation”.another noncash item is deferred taxes, which does not represent a cash flow.mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-17income statement analysis3.time and costsin

25、 the short run, certain equipment, resources, and commitments of the firm are fixed, but the firm can vary such inputs as labor and raw materials.in the long run, all inputs of production (and hence costs) are variable.financial accountants do not distinguish between variable costs and fixed costs.

26、instead, accounting costs usually fit into a classification that distinguishes product costs from period costs.mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-182.3 net working capitalnet working capital current assets current liabilitiesnwc is usua

27、lly growing with the firm. mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-19the balance sheet of the u.s.c.c.(in $ millions)20x2 and 20x1balance sheetu.s. composite corporationliabilities (debt)assets20x220x1and stockholders equity20x220x1current a

28、ssets:current liabilities: cash and equivalents$140$107 accounts payable$213$197 accounts receivable294270 notes payable5053 inventories269280 accrued expenses223205 other5850 total current liabilities$486$455 total current assets$761$707long-term liabilities:fixed assets: deferred taxes$117$104 pro

29、perty, plant, and equipment$1,423$1,274 long-term debt471458 less accumulated depreciation-550-460 total long-term liabilities$588$562 net property, plant, and equipment873814 intangible assets and other245221stockholders equity: total fixed assets$1,118$1,035 preferred stock$39$39 common stock ($1

30、par value)5532 capital surplus347327 accumulated retained earnings390347 less treasury stock-26-20 total equity$805$725total assets$1,879$1,742total liabilities and stockholders equity $1,879$1,742here we see nwc grow to $275 million in 20x2 from $252 million in 20x1. this increase of $23 million is

31、 an investment of the firm.$23 million$275m = $761m- $486m$252m = $707- $455mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-202.4 financial cash flowin finance, the most important item that can be extracted from financial statements is the actual ca

32、sh flow of the firm.since there is no magic in finance, it must be the case that the cash from received from the firms assets must equal the cash flows to the firms creditors and stockholders.cf(a) cf(b) + cf(s) mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights

33、reserved.2-21financial cash flow of the u.s.c.c.(in $ millions)20x2financial cash flowu.s. composite corporationcash flow of the firmoperating cash flow$238 (earnings before interest and taxes plus depreciation minus taxes)capital spending(173) (acquisitions of fixed assets minus sales of fixed asse

34、ts)additions to net working capital(23) total$42cash flow of investors in the firmdebt$36 (interest plus retirement of debt minus long-term debt financing)equity6 (dividends plus repurchase of equity minus new equity financing) total$42operating cash flow:ebit$219depreciation $90current taxes($71)oc

35、f$238mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-22financial cash flow of the u.s.c.c.(in $ millions)20x2financial cash flowu.s. composite corporationcash flow of the firmoperating cash flow$238 (earnings before interest and taxes plus depreciat

36、ion minus taxes)capital spending (acquisitions of fixed assets minus sales of fixed assets)additions to net working capital totalcash flow of investors in the firmdebt (interest plus retirement of debt minus long-term debt financing)equity (dividends plus repurchase of equity minus new equity financ

37、ing) totalcapital spendingpurchase of fixed assets $198sales of fixed assets (25)capital spending $173(173)(23)$42$366$42mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-23financial cash flow of the u.s.c.c.(in $ millions)20x2financial cash flowu.s.

38、composite corporationcash flow of the firmoperating cash flow$238 (earnings before interest and taxes plus depreciation minus taxes)capital spending (acquisitions of fixed assets minus sales of fixed assets)additions to net working capital totalcash flow of investors in the firmdebt (interest plus r

39、etirement of debt minus long-term debt financing)equity (dividends plus repurchase of equity minus new equity financing) totalnwc grew from $275 million in 20x2 from $252 millionin 20x1.this increase of $23 million is the addition to nwc.(173)(23)$42$366$42mcgraw-hill/irwincorporate finance, 7/e 200

40、5 the mcgraw-hill companies, inc. all rights reserved.2-24financial cash flow of the u.s.c.c.(in $ millions)20x2financial cash flowu.s. composite corporationcash flow of the firmoperating cash flow$238 (earnings before interest and taxes plus depreciation minus taxes)capital spending (acquisitions o

41、f fixed assets minus sales of fixed assets)additions to net working capital totalcash flow of investors in the firmdebt (interest plus retirement of debt minus long-term debt financing)equity (dividends plus repurchase of equity minus new equity financing) total(173)(23)$42$366$42mcgraw-hill/irwinco

42、rporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-25financial cash flow of the u.s.c.c.(in $ millions)20x2financial cash flowu.s. composite corporationcash flow of the firmoperating cash flow$238 (earnings before interest and taxes plus depreciation minus taxes)capital

43、spending (acquisitions of fixed assets minus sales of fixed assets)additions to net working capital totalcash flow of investors in the firmdebt (interest plus retirement of debt minus long-term debt financing)equity (dividends plus repurchase of equity minus new equity financing) totalcash flow to c

44、reditorsinterest $49retirementof debt 73debt service 122proceeds from new debt sales (86)total36(173)(23)$42$366$42mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-26financial cash flow of the u.s.c.c.(in $ millions)20x2financial cash flowu.s. compos

45、ite corporationcash flow of the firmoperating cash flow$238 (earnings before interest and taxes plus depreciation minus taxes)capital spending (acquisitions of fixed assets minus sales of fixed assets)additions to net working capital totalcash flow of investors in the firmdebt (interest plus retirem

46、ent of debt minus long-term debt financing)equity (dividends plus repurchase of equity minus new equity financing) totalcash flow to stockholdersdividends $43repurchase of stock 6cash to stockholders 49proceeds from newstock issue (43)total $6(173)(23)$42$366$42mcgraw-hill/irwincorporate finance, 7/

47、e 2005 the mcgraw-hill companies, inc. all rights reserved.2-27financial cash flow of the u.s.c.c.(in $ millions)20x2financial cash flowu.s. composite corporationcash flow of the firmoperating cash flow$238 (earnings before interest and taxes plus depreciation minus taxes)capital spending (acquisiti

48、ons of fixed assets minus sales of fixed assets)additions to net working capital totalcash flow of investors in the firmdebt (interest plus retirement of debt minus long-term debt financing)equity (dividends plus repurchase of equity minus new equity financing) total)()()(scfbcfacfthe cash from rece

49、ived from the firms assets must equal the cash flows to the firms creditors and stockholders:(173)(23)$42$366$42mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-282.5 the statement of cash flowsthere is an official accounting statement called the sta

50、tement of cash flows.this helps explain the change in accounting cash, which for u.s. composite is $33 million in 20x2.the three components of the statement of cash flows arecash flow from operating activitiescash flow from investing activitiescash flow from financing activitiesmcgraw-hill/irwincorp

51、orate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-29u.s.c.c. cash flowfrom operating activities(in $ millions)20x2cash flow from operating activitiesu.s. composite corporationto calculate cash flow from operations, start with net income, add back noncash items like deprec

52、iation and adjust for changes in current assets and liabilities (other than cash).operationsnet incomedepreciationdeferred taxeschanges in assets and liabilitiesaccounts receivableinventoriesaccounts payableaccrued expensesnotes payableothertotal cash flow from operations$869013(24)111618(3)$199(8)m

53、cgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-30u.s.c.c. cash flowfrom investing activities(in $ millions)20x2cash flow from investing activitiesu.s. composite corporationcash flow from investing activities involves changesin capital assets: acquis

54、ition of fixed assets and sales of fixed assets(i.e. net capital expenditures).acquisition of fixed assetssales of fixed assetstotal cash flow from investing activities$(198)25$(173)mcgraw-hill/irwincorporate finance, 7/e 2005 the mcgraw-hill companies, inc. all rights reserved.2-31u.s.c.c. cash flowfrom financing activities(in $ millions)20x2cash flow from financing activitiesu.s. composite corporationcash flows to and from creditors and owners include c