7- Auditors and regulators are reminding firms to look closely at their accounts payable to be sure they haven’t inadvertently created debt that might alter leverage ratios and violate other loan covenants.
What type of debt are they referring to?
What are some examples of situations / structures that might appear to be operating A-P, but in face should be classified as long term debt?
Discuss the advantages and disadvantages of these various situations / structures?
8- Why ” Gross versus Net” became such a big issue in accounting?
9- For each of the steps in the “Seven Step Forecasting Game Plan” for forecasting, discuss the following:
Who do you suspect is being included in creating each step of the various company forecasts?
Why? Why not? Be specific about the various players and the reasons they might be involved.
10 – What are factors that affect the expected rate of return for holders of debt and equity?
11- Why do you think so much emphasis is placed on cash-flow-based stock evaluations, especially the “free cash flow model”?
12- The Peg Ratio appears to be a refinement that allows us to do what? Is the ratio aptly named? Explain