FIN 305 Lecture Notes - Lecture 5: Income Statement, Compound Annual Growth Rate, Operating Margin

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5 forms of analysis (can be used for each type of financial statement: vertical, horizontal, combined, ratios, graphical analysis. Earnings per share (eps: predicting future performance, evaluation past performance. Less [expense, profit level, sales, whatever u r calcuating from the previous period] Divided by[expense, profit level, sales, whatever u r calcuating from the previous period] [expense, profit level, sales, whatever u r calcuating] Divided by [expense, profit level, sales, whatever u r calcuating from the previous period] Formula should only be used when the growth is linear sales/expesnes/profit from a period sales/expesnes/profit from a previous period / sales/expesnes/profit from the previous period x 100(%) Therefore, to predict sales in 2015 based on this formula: = 867,114 (rounded to 867,000) might as well round because uncertainty, so rounds down. Therefore, to predict sales for 2015 based on this formula. = 835,478 (rounded to 835,000) once again rounded down for uncertainty.

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