Business Finance Formulae Sheet: R PV FV
Business Finance Formulae Sheet: R PV FV
Business Finance Formulae Sheet: R PV FV
FV PV 1 r
n
1. FUTURE VALUE OF A SINGLE SUM
1 r n 1
3. FV PMT FUTURE VALUE OF AN ORDINARY ANNUITY
r
1 1 r n
4. PV PMT PRESENT VALUE OF AN ORDINARY ANNUITY
r
1 r n 1
5. FV PMT (1 r )
1
FUTURE VALUE OF AN ANNUITY DUE
r
1 1 r ( n 1)
6. PV PMT PMT PRESENT VALUE OF AN ANNUITY DUE
r
PMT
7. PV PRESENT VALUE OF A PERPETUITY
r
m
NIR
8. ie 1 1 EFFECTIVE RATE OF INTEREST
m
1 1 rd n
Bondprice PMT FaceValue 1 rd
n
9. BONDPRICE
rd
d1
10. P0 CONSTANT DIVIDENDS PRICING MODEL
re
d 1 g d1
11. P0 0 for re g CONSTANT GROWTH IN DIVIDENDS PRICING MODEL
re g re g
d1
12. DIVY DIVIDEND YIELD
P0
P1 P0
13. CGY CAPITAL GAINS YIELD
P0
Average.net. profit
14. ARR = Average.book .value ACCOUNTING RATE OF RETURN
n
CFt
15. NPV CF0 NET PRESENT VALUE
t 1 1 r t
1
BUSINESS FINANCE FORMULAE SHEET
1 b
16. re g
PRICE-EARNINGS RATIO
n
17. Ri Rt Prt INDIVIDUAL ASSET - EXPECTED RETURN
t 1
R R
n
2
18. i t i Prt INDIVIDUAL ASSET - STANDARD DEVIATION (RISK)
t 1
cov i ,m i , m i m
20. INDIVIDUAL ASSET - BETA
2m 2m
25. E ( R ) p R f Rm R f p
CAPITAL MARKET LINE (CML) EQUATION
m
E ( Ri ) R f
26. Re ward .to.risk REWARD-TO-RISK RATIO
i
E D
27. WACC re rd 1 Tc WEIGHTED AVERAGE COST OF CAPITAL (WACC)
V V
d pref
28. R pref COST OF PREFERENCE SHARES
P0