Cash flow analysis

Fund flow analysis

Cost of Capital
Capital structuring
Capital Bugetting
Working capital management
 Basic Finance

Value Percent Increase/Decrease Answer

100 10% 110
200 -20% 160
300 265% 795
Start/P.Y(2017) End/C.Y(2018) Percentage Change Answer Name
600 500 End/Start-1 -17% Cogs
500 600 End/Start-1 20% EBITA
Value Total Revenue As Percentage Of Total Answer
500 600 Value/Total 83%
300 600 Value/Total 50%
 Coupon Periods

If you own a bond that pays 4% semi annually & total yield is 7% on 21-sep-2018 &
the payment date is on 24-july-2020. Find the following information about the bond.

Settlement Date 9/21/2018 Redeemption Value 200

Maturity Date 7/24/2020 Issue Date 6/6/2018
Coupon Frequency 2 Invested Amount 150
Basis(set to 1 if interest is calculated
daily) 1
Coupon Rate 3% Discount Rate 3%
Yield 5%
Answer
Period From S.D to M.D 59 Price 187.83728
Days in the coupon S. period 184 Bond Yield 5.00%
Days to next coupon Payment -125 Annual Yield 3.52%
Date of Next Coupon Payment 1/24/2019 Yield To Maturity -23.69%
Date of Previous Coupon Payment 7/24/2018 Interest Rate 18.12%
Number of coupons to be paid 4 Price Per 100$ 187.67591
Duration 1.794792557 Price Per 100$ at M 96.554065
Modified Duration 1.7510171287 Recevied per 100$ 159.85003

If you own a T-bills with the following dates. Find

the following Values?

Settlement Date 9/21/2018

Maturity Date 7/24/2019
Discount Rate 4%
Answer

Bond Equivalent Yield 4.16%

T-Bill Price Per 100$ 96.6
T-Bill Yield Price Per 100$ 4.14%
 If you own a bond that pays 5% annually at odd periods & total yield is 3% on 2-jan-
2018 & the payment date is on 31-mar-2022. Find the following information about the
bond.

Settlement Date 2/1/2018

Maturity Date 3/31/2022
Coupon Frequency 1

Basis(set to 1 if interest is calculated daily) 1

Coupon Rate 5%
Yield 3%

Answer
Price for Bond with Odd Coupon period 109.76565
Interest At Maturity $0.63
Discount Rate -2.35%
Accrued Interest 23.45677
Yield 2.50%
Price At Last Period 109.04003
Yield At Last Period 2.33%
s & total yield is 3% on 2-jan-
ollowing information about the

Redeemption Value 100

Issue Date 12/21/2017
Invested Amount 150

First Coupon Date 3/31/2018

Last Coupon Date 4/14/2017
Depreciation

If you bought a laptop for 1,300. its useful life is 5 years & If you bought a Bus for 500,000. its useful life
its resale value is 150. Calculate depreciation using its salvage value is 25,000. Calculate deprec
straight line method Declining balance method& Double D.B.M. A
for a new one bought on august same

Laptop Price 1,300 Bus Price 500,000

Salvage Value 150 Salvage Value 25,000
Economic Life 5 Economic Life 8

S.L.M Depreciation $230.00 D.B.M Depreciation

If you bought a building for 1000000. its useful life is10 years and
salvage value is 50,000. Find best depreciation rate by comparing
S.L.M &D.B.M. also calculate using sum of years method.

Building Price 1000000

Salvage Value 50,000 Variable D.B Method
Economic Life 10

Year Depreciation
1 $200,000.00
2 $160,000.00
3 $128,000.00
4 $102,400.00
5 $81,920.00
6 $65,536.00
7 $53,036.00
8 $53,036.00
9 $53,036.00
10 $53,036.00
 500,000. its useful life is 8 years &
,000. Calculate depreciation using
hod& Double D.B.M. Also calculate
ought on august same year

Year Depreciation New One D.D.B.M

1 $156,000.00 $52,000.00 $125,000.00
2 $107,328.00 $139,776.00 $93,750.00
3 $73,841.66 $96,165.89 $70,312.50
4 $50,803.06 $66,162.13 $52,734.38
5 $34,952.51 $45,519.55 $39,550.78
6 $24,047.33 $31,317.45 $29,663.09
7 $16,544.56 $21,546.40 $22,247.31
8 $11,382.66 $14,823.93 $16,685.49
9 $6,799.24

S.O.Y Method

Year Depreciation
1 $172,727.27
2 $155,454.55
3 $138,181.82
4 $120,909.09
5 $103,636.36
6 $86,363.64
7 $69,090.91
8 $51,818.18
9 $34,545.45
10 $17,272.73
Interest Rate

If we invest 10,000 and it doubles in 5 years what is my

interest rate?

Investment Amount 10,000

Future Value 20,000
Period 5

Interest Rate 15%

Number Of Period

If we take a 100,000 loan at 8% & with a payment

of 3000 monthly. How long will it take to repay it?

Loan Amount 100,000

Interest Rate 8%
Monthly Payment 3,000
Monthly Interest 0.0066667
Number Of periods 37.538184
In Years 3.128182
 Nominal Interest Rate

If the effective interest rate is 10% & is compounded

Monthly. Find the Annual Percentage Rate(N.I.R)?

Effective Interest Rate 10%

Number Of Periods Compounded 12

Nominal Interest Rate 9.57%

If we deposit 10,000 $ in a bank and get 5% interest. How long will it take to make our
deposit 20,000?

Present Value 10,000

Future Value 20,000
Interest Rate 5%
Monthly Interest 0.004166666666667
Number Of periods 166.701656748652
In Years 13.8918047290543
Effective Interest Rate

If the nominal interest rate is 8% & is

compounded quarterly. Find the effective
interest rate(A.P.Y)?

Nominal Interest Rate 8%

Number Of Periods Compounded 4

Effective Interest Rate 8.24%

 EIR Table
Nominal Rate 7%

Time Period Effective Rate

1 Annual 7.00%
2 Semi Annual 7.12%
4 Quarterly 7.19%
12 Monthly 7.23%
26 Bi-Weekly 7.24%
52 Weekly 7.25%
365 Daily 7.25%
Future Value

If you put 10,000 into bank for 10 years at 8% interest. What

is the future value at the end and start of the period? Also
find value F.V if the amount get different annual interest
rates?

Amount 10,000
Interest Rate 8%
Years 10
Future value $21,589.25 $21,589.25
At End At Start
Years Interest Rates
1 4%
2 5%
3 6%
4 7%

Future value(schdule 12385.464

Payment

i took a 15,000 $ loan at 6.5% with a payment period of 4 year. Find the monthly
payment?

Answer
Loan Amount 15,000 monthly Interest Rate 0.0054167
Interest Rate 6.50% Number Of Months 48
Years 4

Monthly Paymment $355.72

Interest Payment

Find the interest amount payed on the at the Find the principal amou
start of the 3rd year? Also find the total interest 2nd quarter of the 3rd
payed in the 3rd year? principal payed in the at

Answer
monthly Interest Rate 0.0054167
Number Of Months 48
loan amount 15,000
start of 3rd year 25
Start 25
End 36

Interest Payment $43.25

Total Interest Payment -405.3082

Loan Schedule

Period Payment Interest Principal

1 $355.72 81.25 $274.47

2 $355.72 $79.76 $275.96
3 $355.72 $78.27 $277.46
4 $355.72 $76.77 $278.96
5 $355.72 $75.25 $280.47
6 $355.72 $73.74 $281.99
7 $355.72 $72.21 $283.52
8 $355.72 $70.67 $285.05
9 $355.72 $69.13 $286.60
10 $355.72 $67.58 $288.15
11 $355.72 $66.01 $289.71
12 $355.72 $64.45 $291.28
13 $355.72 $62.87 $292.86
14 $355.72 $61.28 $294.44
15 $355.72 $59.69 $296.04
16 $355.72 $58.08 $297.64
17 $355.72 $56.47 $299.25
18 $355.72 $54.85 $300.87
19 $355.72 $53.22 $302.50
20 $355.72 $51.58 $304.14
21 $355.72 $49.93 $305.79
22 $355.72 $48.28 $307.45
23 $355.72 $46.61 $309.11
24 $355.72 $44.94 $310.79
25 $355.72 $43.25 $312.47
26 $355.72 $41.56 $314.16
27 $355.72 $39.86 $315.86
28 $355.72 $38.15 $317.57
29 $355.72 $36.43 $319.29
30 $355.72 $34.70 $321.02
31 $355.72 $32.96 $322.76
32 $355.72 $31.21 $324.51
33 $355.72 $29.45 $326.27
34 $355.72 $27.69 $328.04
35 $355.72 $25.91 $329.81
36 $355.72 $24.12 $331.60
37 $355.72 $22.33 $333.40
38 $355.72 $20.52 $335.20
39 $355.72 $18.71 $337.02
40 $355.72 $16.88 $338.84
41 $355.72 $15.05 $340.68
42 $355.72 $13.20 $342.52
43 $355.72 $11.34 $344.38
44 $355.72 $9.48 $346.24
45 $355.72 $7.60 $348.12
46 $355.72 $5.72 $350.01
47 $355.72 $3.82 $351.90
48 $355.72 $1.92 $353.81
 Principal Payment

Find the principal amount payed at the end of the

2nd quarter of the 3rd year? Also find the total
principal payed in the at the 2nd end of the 1st year?

Answer
monthly Interest Rate 0.0054167
Number Of Months 48
loan amount 15,000
end of 2nd quarter of 3rd year 30
start 7
end 12

Principal payment $321.02

Total Principal payment -1724.301

Residual Debt

$14,725.53
$14,449.56
$14,172.11
$13,893.15
$13,612.68
$13,330.69
$13,047.18
$12,762.12
$12,475.53
$12,187.38
$11,897.67
$11,606.39
$11,313.53
$11,019.09
$10,723.05
$10,425.41
$10,126.16
$9,825.29
$9,522.78
$9,218.64
$8,912.85
$8,605.40
$8,296.29
$7,985.50
$7,673.04
$7,358.87
$7,043.01
$6,725.43
$6,406.14
$6,085.12
$5,762.35
$5,437.84
$5,111.57
$4,783.53
$4,453.72
$4,122.12
$3,788.73
$3,453.52
$3,116.51
$2,777.66
$2,436.98
$2,094.46
$1,750.08
$1,403.84
$1,055.72
$705.71
$353.81
($0.00)
Net Present Value

Year Cash Flow

0 $ (350.00)
1 $ 100.00
2 $ 200.00
3 $ 150.00
4 $ 75.00

Net Present Value 117.92

Net Present Value $ 117.92

Internal Rate Of Return

If IRR is greater than borrowing rate/investment return we consider the project/investment

If IRR is less than borrowing rate/investment return we reject the project/investment
we compare both N.P.V & I.R.R to pick the best investment

If you invest 20,000 $ in a car. The car generates the

following cash flow at different periods. Find the I.R.R &
N.P.V for the car also find I.R.R if we reinvest 5% &at a fixed
date?

Date
5/5/2014
7/7/2015
3/13/2016
9/20/2017
11/8/2018
4/21/2019
Interest Rate
Reinvest Rate
Modified Internal Rate Of Return
Internal Rate Of Return
Net Present Value
Interest Rate 5%
Present Value
-350.00
95.24
181.41
129.58
61.70 1
2
Manual 3
Excel 4
5

Internal Rate Of Return

Net Present Value

Answer

Amount
-20,000
4000
3,500
8000
5000
9000
10%
5%
10%
12%
1164.169385963
 Which Of The following investment is the best?

Discount Rate 7%
Cash Flow Investment 1 Cash Flow Investment 2

-100,000 -100,000
25,000 1 20000
25000 2 20000
25000 3 20000
25000 4 20000
25000 5 20,000
6 25,000

8% Internal Rate Of Return 7%

22,841.93 Net Present Value $22,416.13

The First one is better

est?
Present Value

With an interest rate of 6% what is the current value of 7 million dollars? If you receive it in 15 years?

Question Answer
interest rate 6% Present Value $2,920,855.43
years 15
Future Value 7,000,000

What is the present vaue of putting 500 in bank acount with interest rate of 2.75% for 6 years?

Question
Interest Rate 2.75% Present Value $2,731.18
Years 6
Payment 500
Zero At the end of the period
One At the beginning of the period
 If you were to sell an asset(house) in 3 years at 170,000. and the standadr for it is discou
e it in 15 years? 4.25%. Whst should you pay for the asset now?

Question Answer
Interest rate 4.25% Present Value $150,044.72
years 3
Future Value 170,000

ars?
Find the loan amount to borrow at 4% for 5 years to make a 500$ monthly
payment?

Question Answer
interest rate 4% rate per period 0.33%
years 5 number of payments 60
payment per year 12 loan $27,150
payment amount $ 500.00
 standadr for it is discount rate is
et now?