What is difference between The earnings multiplier and Discounted cash flow model (DCF)? kindly explain in detail

Q: Where are gains and losses related to cash flow hedgesinvolving anticipated transactions reported?

A: Derivatives: Derivative is a product whose value is derived from underlying assets called base.…

Q: Which of the following method is not based on concept of time value of money? A. Discounted payback…

A: Time value of money is based on the concept, that money you have today worth more than it in the…

Q: What is Internal Rate of Return - Variable Cash Flows with Reversion?  Please provide examples.

A: The internal rate of return is the one of the discounted techniques of capital budgeting which is…

Q: Does the payback-period analysis ignore differences in the timing of cash flows?

A: The time value of money (TVM) is the possibility that in view of its inevitable procuring influence,…

Q: How is payback calculated with equal net cash inflows?

A: A payback period is the amount of time needed to earn back the cost of an investment. The length of…

Q: Describe the discounted cash flow techniques?

A: Following are the discounted cash flow techniques: Net present value (NPV) is the contrast between…

Q: Which is more important from a finance perspective-net income or operating cash flow? What is the…

A: Net income is calculated in the income statement whereas and operating cash flows are calculated in…

Q: what are usefulness and weakness of discounted cash flow method?

A: Discounted Cashflow Method is the Method in which we compare Initial Project cost with expected…

Q: Cash surplus and economic assumptions are components of a financial planning model. True or False

A: Future is uncertain and it contains various risk factors. Financial planning (FP) model is used to…

Q: Explain the difference between: a) Cash Flows versus Accounting Estimates b) Static Payback Period…

A: When a company prepares financial statements or budgets it has to estimate various amounts. The…

Q: what are the operational aspects of the discounted cash flow (DCF) method?

A: What Is Discounted Cash Flow (DCF)?  Limited income (DCF) is a valuation technique used to assess…

Q: How is IRR calculated with unequal net cash inflows?

A: Definition:   Internal rate of return method (IRR): Internal rate of return method is one of the…

Q: What cash flows are discounted in the FCFE model, and what is the discount rate?

A: FCFE MODEL: FCFR is known as free cash flow to equity or levered free cash flow, it is a model…

Q: What is FCF (Free Cash Flow) to Equity ratio?

A: The amount of cash generated by a company that is available to be transferred to shareholders is…

Q: Which financial statements are more useful to consumers than others when it comes to cash flow…

A: The question tells about financial statements are more useful to consumers than others when it comes…

Q: Define DCF (discounted cash flow) analysis

A: Discounting cashflow

Q: How can we develop the techniques for establishing cash flow equivalence with compound-interest…

A: Answer: To measure the equivalence of the sequence of compound interest factors used to extract the…

Q: yback method, the Accounting Rate of Return, and Discounted Cash Flow Model (Ne

A: Step 1 A huge budget is a method through which a company assesses possible substantial projects or…

Q: Define the positive cash flows?

A: The positive cash flow is the state of the organization wherein money inflows to an enterprise over…

Q: Discuss the limitations of the traditional discounted cash flow (DCF) analysis

A: Discounted cash flow determines the present value of the future cash flow of the company. It is…

Q: What do the Cash flow diagrams represent?

A: They are utilized by accountants and engineers in the management to mirror the money exchanges that…

Q: What factors lead to a better cash flow position? How?

A: Cash flows refer to the amount of net cash and cash equivalents that flow in and out of the…

Q: What are the strenghts and weaknesses of the discount cash flow methods?

A: discounted cash flow methods are used to calculate to find the future cash inflow discount into its…

Q: why discounted cash flow methods are preferred to the more traditional techniques of payback and…

A: Before knowing the reason of preference for the use of any method, let us see the basic description…

Q: Is cash flow more reliable than accounting profit? Which one is more useful?

A: Cash Flow Cash flow system records the cash inflow and cash outflow to determine company's…

Q: What does the operating cycle and the cash conversion cycle tell the financial analyst and how does…

A: Financial analysts use different types of ratios and financial data in order to assess the…

Q: How to do Cash Flow Projection when investing? give a example.

A: Cash flow cash flow (CFI) is one of the components of a cash flow statement that reports the amount…

Q: List and explain t the difference between profit and cash flow

A: Cash flow:- It is the movement of money or flow of money within the organization. Money can either…

Q: Describe how volatile the payout ratios are based on earnings and cash flows.

A: Dividends payout ratio can be defined as the paying out the dividends to its shareholders on the…

Q: What is the incremental cash flows from switching credit policies?

A: Incremental cash flow is the extra cash flow a business will generate by investment in a new project…

Q: Which is higher, net earnings or operating cash flows? Which line item is the biggestreason for this…

A: Operating activities: Operating activities refer to the normal activities of a company to carry out…

Q: Why are the net present value and internal rate of return considered discounted cash flow methods?

A: Net present value is the comparison between the net cash inflows received from a future investment…

Q: Describe the Probabilistic Cash Flow Analysis?

A: Answer: Cash flow applies to the overall sum of cash and cash equivalents that come into and out of…

Q: Discuss why the present value of cash flows and the relative valuation ratios valuation approaches…

A: Valuation of entity is done in two methods as: Discounting expected inflows from entity in upcoming…

Q: Briefly explain the concept of discounted-cash-flow analysis. What are the two common methods of…

A:

Q: Which of the following can be used when forecasting cash flows? Select one: a. All of given choices.…

A: Cash flow refers to inflow or outflow of cash from the business during an accounting year.…

Q: Which is more important from a finance perspective - net income or operating cash flow? Why? What is…

A:

Q: What is the essence of the discounted cash flow methods?

A:

Q: Is Cash Flow more important than  Accrual Based Income?

A: Cash flow: It can be defined as the aggregated balance of cash and cash equivalents that are…

Q: Explain the traditional model of money demand

A: Demand for money is required for Private Consumption. It results in Gross Domestic Product. GDP is…

Q: How is payback calculated with unequal net cash inflows?

A:

Q: Illustrate the concept of present-worth analysis based on cash flowequivalence along with the…

A: The concept of present-worth analysis based on cash flow equivalence along with the payback period.…

Q: Why, in most cases, accrual-basis net income provides a better measure of perfomance than net…

A: Under the accrual method of accounting, income is recorded on the income statement when it is…

Q: What are the strenghts and weaknesses of the Discounted Cash Flow methods

A: Cash flow is the movement of money from a particular investment. Discounted cash flows mean…

Q: can be helpful for managers to understand short-term cash obligations. A) Profitability ratios B)…

A: Ratio analysis is the measure of company performance, by measuring different ratios.

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.