Finance Formula Sheet

Every essential finance formula and ratio in one place. Print it or keep it open while you study.

Present Value

tvm

PV = FV / (1 + r)^n

Future Value

tvm

FV = PV × (1 + r)^n

Net Present Value

capital budgeting

NPV = Σ CF_t / (1+r)^t - Initial Cost

Internal Rate of Return

capital budgeting

0 = Σ CF_t / (1+IRR)^t - Initial Cost

WACC

cost of-capital

WACC = (E/V)×Re + (D/V)×Rd×(1-T)

CAPM

risk return

E(R) = Rf + β × (Rm - Rf)

Gordon Growth Model

valuation

P = D1 / (r - g)

Bond Price

fixed income

Price = Σ C/(1+r)^t + FV/(1+r)^n

Current Ratio

liquidity

Current Ratio = Current Assets / Current Liabilities

Debt-to-Equity Ratio

leverage

D/E = Total Debt / Total Equity

Return on Equity

profitability

ROE = Net Income / Shareholders' Equity

Payback Period

capital budgeting

Payback = Years before full recovery + (Unrecovered cost / Cash flow in recovery year)

Profitability Index

capital budgeting

PI = PV of Future Cash Flows / Initial Investment

Free Cash Flow to Firm

valuation

FCFF = EBIT(1-T) + D&A - CapEx - ΔNWC

EBITDA Margin

profitability

EBITDA Margin = EBITDA / Revenue

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