Business Analyst Investment Banking Online Training

• The Income Statement, Balance Sheet, and Cash Flow Statement are the three primary financial statements. The income statement reveals a company’s final net income as well as its sales and expenses over a period of time, which is important information regarding their importance.
• A company’s assets, including its plant, property, and equipment, cash, inventories, and other resources, are represented on the balance sheet. The liabilities are similarly disclosed,
• including the debt, accounts payable, and equity owned by shareholders. The assets would always equal the liabilities plus shareholders’ equity on the balance sheet.
• Last but not least, a cash flow statement shows the net change in cash. It provides the cash flow from the business’s investing, operating, and financing activities.

Business Analyst Investment

Business Analyst Investment

• It would be the cash flow statement. The reason is that it provides a true picture of how much cash the business is generating in actual terms.
• Hence, the cash flows are the main thing you pay attention to while you are analyzing the business’s overall financial health.

• Income Statement: Assuming a 40% tax rate, a decrease in depreciation costs would result in an operating income reduction of $100 and a net income decline of $60.
• Cash Flow Statement: The $100 Depreciation is a non-cash item that is brought back, therefore overall Cash Flow from Operations increases by $40. The top of the cash flow statement shows a $60 decrease in Net Income. The overall Net Change in Cash rises by $40 in the absence of any further adjustments.
• Balance Sheet: Due to depreciation, Plants, Property & Equipment on the asset side decreased by $100, but cash increased by $40 as a result of changes to the Cash Flow Statement.

• WACC is calculated as follows: Cost of Equity * Proportion of Equity + Cost of Debt * Proportion of Debt * Tax Rate. The Capital Asset Pricing Model (CAPM) is used to calculate the cost of equity.
• Cost of equity = Risk-free rate + beta* Equity risk premium is the formula.
• Cost of Debt = The yield on a 10- or 20-year U.S. Treasury bond at the risk-free rate.
• Based on how risky the comparable companies and stocks are, beta is estimated.
• The amount by which equities are anticipated to beat “riskless” assets is known as the risk premium.
• The percentage represents how much of the capital structure of the company is occupied by each component.

By learning Business Analyst Investment through VISWA Online Trainings, advance in your job.