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CFA Book 3 Lesson 42
lesson 42
6
Finance
Post-Graduate
05/22/2010

Additional Finance Flashcards

 


 

Cards

Term
Important aspects of a company's business strategy can be revealed by...
Definition
trends in its financial ratios and differences between its financial ratios and those of its competitors or industry average ratios 
Term
A company's future income and cash flows can be projected by...
Definition
forecasting sales growth and using estimates of profit margins and the increases in working capital and fixed assets necessary to support the future sales growth
Term
Credit analysis uses...
Definition
a firm's financial statements to assess its credit quality
Term
Indicators of a firm's creditworthiness include...
Definition

-its scale and diversification

-operational efficiency

-margin stability

-use of financial leverage

Term
Potentially attractive equity investments can be identified by...
Definition
screening a universe of stocks, using minimum or maximum values of one or more ratios. Which (and how many) ratios to use, what minimum or maximum values to use, and how much importance to give each ratio all present challenges to the analyst.
Term
When companies use different accounting methods or estimates relating to areas such as inventory accounting, depreciation, capitalization, and off-balance-sheet financing, 
Definition
analysts must adjust the financial statements for compatibility.
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