About This Chapter
Who's It For?
Anyone who needs help learning or mastering the ways to analyze financial statements will benefit from the lessons in this chapter. There is no faster or easier way to learn how to analyze financial statements. Among those who would benefit are:
- Students who have fallen behind in understanding working with financial statements
- Students who struggle with learning disabilities or learning differences, including autism and ADHD
- Students who prefer multiple ways of learning finance (visual or auditory)
- Students who have missed class time and need to catch up
- Students who need an efficient way to learn about analyzing financial statements
- Students who struggle to understand their teachers
- Students who attend schools without extra finance learning resources
How It Works:
- Find videos in our course that cover what you need to learn or review.
- Press play and watch the video lesson.
- Refer to the video transcripts to reinforce your learning.
- Test your understanding of each lesson with short quizzes.
- Verify you're ready by completing the analyzing financial statements chapter exam.
Why It Works:
- Study Efficiently: Skip what you know, review what you don't.
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- Study With Flexibility: Watch videos on any web-ready device.
Students Will Review:
This chapter helps students review the concepts in an analyzing financial statements unit of a standard corporate finance course. Topics covered include:
- The purpose and elements of financial statement analysis
- Methods of horizontal and vertical analysis of financial statements
- The formula and limitations of financial ratio analysis
- The types of financial ratios for companies
1. Financial Statement Analysis: Definition, Purpose, Elements & Examples
In this lesson, we'll define financial statement analysis and discuss the main categories. You'll also learn how to calculate a financial ratio in each category and analyze the results.
2. Straight-Line Depreciation: Method, Formula & Example
Part of the allure of the straight-line depreciation method is that it takes the guesswork out of figuring out the value of a fixed asset. Learn more about the methodology of straight-line depreciation and practice using the formula for calculating it through a series of examples.
3. Times Interest Earned Ratio: Formula & Analysis
A times interest earned ratio is the proportion of income a company used for covering interest expenses. Learn the formula used to calculate the times interest earned ratio, the significance of interest rates and risk, and the importance of conducting an analysis of the results.
4. Total Expenses: Ratio & Formula
A total expense ratio (TER) is used in business to determine the value of assets in a mutual fund in relation to operating and management costs. Learn about total expense ratio, total fund assets/costs, and how to use a formula to calculate total expense ratios.
5. What is a Fiscal Year? - Definition & Example
The fiscal year is the 12-month period that is used for accounting and financial statements. Understand the full definition and see examples of businesses and governments whose fiscal year is 12 months, but does not align with the January 1st new year.
6. What is Fair Value? - Definition, Principle, Measurement & Examples
Fair value is a method of determining a reasonable price for a product, asset or even an entire business that is operating in the marketplace. Learn more about its definition, principles, measurements and examples.
7. What Is Financing? - Definition & Types
When a person is need of financial assistance, they may go to a financial institution and request financing, which is when a financial institution sets up a program to help a lender make a purchase with the promise to repay in an affordable manner. Explore the idea of financing, looking at the different types of financing that are available to consumers.
8. What is Preferred Stock? - Definition, Types & Advantages
Preferred stock is a category of investment securities that usually has a higher claim to a company's assets and receives higher dividend payments than common stock. Learn the definitions and advantages of the five types of preferred stock, and understand how preferred stock compares to common stock.
9. What Is Quality Planning? - Definition, Process & Tools
Companies want to produce quality work that they're happy with and customers can appreciate. One way to do so is a process known as quality planning. Come along as we learn what quality planning is, the process, and what tools are valuable.
10. What is the Prime Rate? - History & Explanation
The Federal Funds Rate gets the attention of the media, but it's the prime rate that really matters to consumers. In this lesson, you'll learn what the prime rate is, how it is established, and why it matters.
11. What Is Working Capital? - Definition & Formula
The amount of cash and liquid assets a company owns is called working capital. During normal operations, a business must have cash to pay expenses and liabilities that are due. Learn more about the definition and formula, and see an example.
12. Projected Income: Example & Explanation
Projected income is a financial estimate of future profits and losses. Explore an explanation of projected income and learn how to estimate it, how to create a final projection and other uses for projected income.
13. What Are Company Financial Statements? - Definition, Analysis & Examples
There are four company financial statements that are important to a company's financial reporting. Understand and analyze the definition of financial statements, the statement of retained earnings, the income statement, the balance sheet, the statement of cash flow, and examples of each type of financial statement.
14. What Is Cash Flow? - Definition, Calculation & Example
Cash flow refers to the money or cash equivalents that move in and out of a business at a certain period. Learn about the definition of cash flow, and explore the formulas and examples of calculation of free cash flow, operating cash flow, and net cash flow.
15. What Is Debt Ratio? - Calculation & Overview
Debt ratio is the amount of assets compared to the amount of liabilities an organization has. Explore the overview of debt ratios, good and bad debt ratios, and how to calculate them.
16. Fundamental vs. Technical Analysis
In this lesson you will learn what fundamental and technical analysis is, the difference between the two strategies, the pitfalls for each strategy, and how to determine which is best for you.
17. Fundamental Analysis: Definition & Examples
In this lesson you will learn what Fundamental Analysis is, how its used to evaluate shares in a company, and what pieces of information are used to complete that evaluation.
18. Common Technical Analysis Indicators
Technical analysis indicators help in studying the price charts of all types of financial instruments. In this lesson we will look at some of the more common indicators, their characteristics and uses.
19. Intentionally Defective Grantor Trust (IDGT)
In this lesson, you'll learn about an intentionally defective grantor trust (IDGT). This trust takes advantage of two different sets of tax law interpretations.
20. Common Size Analysis: Definition & Examples
There are many methods that a business can use to compare its financial results to that of its competitors to see how successful that business is. In this lesson, you will learn about common size analysis.
21. What is a Swap Contract? - Definition & Examples
This lesson describes and explains the mechanics of interest rate swaps and other swap contracts. You'll also learn how swaps are used by borrowers and investors to reduce risk, add risk, or exchange one type of risk exposure for another.
22. Time Series Analysis & Its Applications
In this lesson, we will explain time series analysis, its purpose and uses. We will define trend, cyclical and seasonal variances. We will solve a real-world business problem using time series analysis.
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Other chapters within the Corporate Finance: Help & Review course
- Introduction to Corporations: Help & Review
- Stockholders & Stakeholders: Help & Review
- Business Capital & Investments: Help & Review
- Raising Capital for Business: Help & Review
- Corporate Spending & Taxation: Help & Review
- Financial Accounting: Help & Review
- Financial Statements: Help & Review
- Government-Business Relations: Help & Review
- Securities & Anti-Trust Laws: Help & Review
- Accounting Risk & Return: Help & Review
- Options, Bankruptcy & Corporate Finance
- Reform & Emerging Global Markets