# Bus Fund I

 (ROS) Return on sales Net profit, generated each year, divided by total sales for the same period. Turn Over (Asset Turn Over) Sales, generated in a particular year, divided by the value of total assets for the same period. (ROA) Return on Assets Net profit, generated each year, divided by the value of total assets for the same period. Leverage Total assets at the end of the period under review divided by owners' equity for the same period. A value of 2 indicates that half the assets have been bought with equity, and the other half with current and/or long term debt. Example: Assets = \$2,000,000Owners' equity = \$1,000,000 \$2,000,000 /\$1,000,000 = 2 (ROE) Return on Equity Net profit, generated each year, divided by the value of owners' equity for that year. (EBIT) Earnings Before Interest and Taxes Profits before loan interest payments, broker fees, write-offs, and bonus income are taken into account. Cumulative Profit Cumulative total of all profits (losses) gen­erated since the game's inception (includes Round 0 profits). SG+A Sales, General and Administrative expenses: In the simulation, SG&A includes all R&D, Marketing, and TQM costs. Contribution Margin Contribution Margin = Sales - (Direct Labor + Direct Materials + Inventory Carry) Contribution Margin % = Sales - (Direct Labor + Direct Materials + Inventory Carry) / Sales (BOND MARKET) Series # Label given to a bond when it was issued. The first numbers are the interest rate. “S” means series, and the last two digits refer to the year the bond is due. 15.4S2011 means that the bond pays a coupon 15.4% each year and that the principal is due in 2011. (BOND MARKET) Face Value For each outstanding bond, Face (\$000): Principal of the issue. If the face is \$11,040,000 then \$11.04M in bonds were issued (unless a portion of the bond was paid off before maturity). Using the 15.4S2006 bond with a face value of \$11.04M as an example, coupons of 15.4% or a total of \$1,700,160 will be paid each year until the bond becomes due in 2006. In 2006, the last coupon and the principal are due. The principal is converted automatically to Current (short term) Debt on December 31 of the year it is due. (BOND MARKET) Yield A measure of what the bond is worth at current interest rates. To calculate, the stated interest rate is divided by the closing bond price. For example, if the stated interest is 15.4% and the closing price is \$115.80 then \$15.40 divided by \$115.80 gives a yield of 13.3%. (BOND MARKET) Close (Outstanding Bonds) Closing price of the bond last year. Bonds are bought and sold in the marketplace, but since their interest payment is fixed, the price of the bond fluctuates. A risk assessment is made for each firm, ranging from “AAA” to “D.” For each lower grade, investors expect an additional 0.5% yield. The simulation adjusts the closing price of the bond so that the yield reflects current interest rates and an appropriate risk. (STOCK MARKET) EPS (Earnings per share) Earnings Per Share = Net Profit for the year divided by the number of Shares Outstanding. (STOCK MARKET) P/E (Price Earnings Ratio) Price Earnings Ratio = Stock Price divided by Earnings Per Share (EPS) Authorslone3000 ID16409 Card SetBus Fund I DescriptionDefinitions Updated2010-04-27T13:45:36Z Show Answers