Basics of financial modelling CAPEX and Asset Schedule

  1. Financial Modelling
    1. Financial Modelling Introduction
    2. Financial Modelling Tools & steps
    3. How to Make a Financial Model and choose the best Company and Excel Workbook Setup?
    4. How to build a financial model Step-by-Step Guide to Excel Sheet Setup?
    5. Financial Statements: A Step-by-Step Guide to Extracting Historical Data
    6. Financial modelling excel
    7. Learn financial modelling Balance Sheets, P&L, and Assumptions Know About
    8. What is financial modelling Assumptions and Projections?
    9. Financial modelling and valuation
    10. Investment decision calculation
    11. The balance sheet’s asset side reveals the company’s line items.
    12. Revenue Model & Growth Rate in in P&L Assumptions
    13. Basics of financial modelling CAPEX and Asset Schedule
    14. Financial Analysis: Gross Block and CAPEX
    15. Gross block & Capex: Constructing the Asset Schedule
    16. Depreciation : Connecting P&L and Balance Sheet for Accurate Asset Forecasting
    17. depreciation expense : Exploring Different Methods in Financial Modeling
    18. Debt Management: Connecting P&L and Balance Sheet for Accurate Liability Projection
    19. Interest Rate Calculation & Debt Schedule
    20. Share Capital & Reserves
    21. IPOs and Under subscription : Bata’s Share Capital Dynamics
    22. Reserves & Surplus understanding Bata schedule
    23. Reserves and surplus schedule How to Build on Excel
    24. Financial modelling projections
    25. Balance Sheet Projections and Completing Reserves Schedule
    26. Cash Flow Statements Analysing Operations, Investments, and Financing Activities
    27. What Is Valuation for Investor
    28. Free Cash Flow Key Components, Formulas and How to Calculate?
    29. FCFF and FCFE uses in Mastering Free Cash Flow Calculation
    30. WACC Weighted Average Cost of Capital Analysis
    31. Market Risk Premium analysis
    32. Tax Shield and its Impact on Equity Holder Returns
    33. Weighted Average Cost of Capital and Terminal Growth in Valuation
    34. Terminal Value Understanding Perpetual Cash Flow Projections in DCF Model
    35. Learn Financial Modelling
    36. Free Cash Flow to the Firm (FCFF) Calculation with examples
    37. Stock Valuation DCF Model & Stock Market Value
Marketopedia / Financial Modelling / Basics of financial modelling CAPEX and Asset Schedule
Asset Schedule Part 2 We will examine the asset schedule.
  • What is the Base rule?
Before constructing our schedules, let’s make sure we have a good grasp of the base rule. You’re likely already aware of it, but I might as well elucidate it now. Let’s take an example. Electric vehicles have grown in popularity and Ola has set out to take advantage of this by developing and selling electric bikes. This is sure to create a stir in the industry. Ola created 4000 electric bikes during their first year of functioning. Here are a few constructed facts –
  • Number of bikes manufactured in 1st-year operations = 4000
  • The total of bikes that have been sold is 3750.
  • 250 bikes remain unsold.
To begin, the opening balance for Ola’s first year of operation was zero. This was followed by the total number of bikes that were purchased throughout the year. Lastly, it ended with a closing balance, which is an assessment of any remaining unsold bikes at the end of the year. The total number of bikes is 4000, since the opening balance is at a tally of zero. This amount comprises all the bikes that were produced. At the end of the year, we can calculate how many bicycles were not sold. This figure is known as the closing balance. Let us suppose that Ola produces and distributes the same amount of bicycles in the second year. Can you share what the commencement, quantity and ending numbers were for the 2nd year? In this particular case, the opening balance for Year 2 is 250, which is the same as the closing balance of Year 1. They produce 4000 new bikes, bringing their total to 4250. Of these, 3750 have already been sold – leaving a balance of 500 at the end of the year. The opening balance for Year 3 is based on the closing balance of the previous year, and this applies every year. The ‘Base rule’ of linking the closing and opening balance is a technique that’s often used in the schedules we build, particularly in the asset schedule. For now, just remember this base rule – we’ll be referencing it soon.