Questions from Corporate Finance

Q: What is EBITDA, and what does it measure?

What is EBITDA, and what does it measure?

Q: Explain how the four financial statements are related?

Explain how the four financial statements are related?

Q: What does it mean when a firm’s cash flow to investors is

What does it mean when a firm’s cash flow to investors is negative?

Q: Which type of tax rate, marginal or average, should be

Which type of tax rate, marginal or average, should be used in analyzing the expansion of a product line, and why?

Q: What is the primary concern of a firm’s creditors?

What is the primary concern of a firm’s creditors?

Q: Why does it make sense to standardize financial statements?

Why does it make sense to standardize financial statements?

Q: What are common-size, or standardized, financial statements,

What are common-size, or standardized, financial statements, and how are they prepared?

Q: What are the efficiency ratios, and what do they measure?

What are the efficiency ratios, and what do they measure? Why, for some firms, is the total asset turnover more important than the fixed asset turnover?

Q: List the leverage ratios discussed in this section, and explain how

List the leverage ratios discussed in this section, and explain how they are related?

Q: List the profitability ratios discussed in this section, and explain how

List the profitability ratios discussed in this section, and explain how they differ from each other?