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## TEMAS RELACIONADOS CON EL MÓDULO DE COSTOS Y

PRESUPUESTOS

FUENTE: http://www.investopedia.com/terms/w/wacc.asp

## A calculation of a firm's cost of capital in which each category of capital is

proportionately weighted. All capital sources - common stock, preferred stock,
bonds and any other long-term debt - are included in a WACC calculation. All
else equal, the WACC of a firm increases as the beta and rate of return on
equity increases, as an increase in WACC notes a decrease in valuation and
a higher risk.

The WACC equation is the cost of each capital component multiplied by its
proportional weight and then summing:

## Weighted Average Cost Of Capital (WACC)

Where:

 Re = cost of equity
 Rd = cost of debt
 E = market value of the firm's equity
 D = market value of the firm's debt
 V=E+D
 E/V = percentage of financing that is equity
 D/V = percentage of financing that is debt
 Tc = corporate tax rate

Businesses often discount cash flows at WACC to determine the Net Present
Value (NPV) of a project, using the formula:

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NPV = Present Value (PV) of the Cash Flows discounted at WACC.

## Broadly speaking, a company's assets are financed by either debt or equity.

WACC is the average of the costs of these sources of financing, each of
which is weighted by its respective use in the given situation. By taking a
weighted average, we can see how much interest the company has to pay for
every dollar it finances.

A firm's WACC is the overall required return on the firm as a whole and, as
such, it is often used internally by company directors to determine the
economic feasibility of expansionary opportunities and mergers. It is the
appropriate discount rate to use for cash flows with risk that is similar to that
of the overall firm.

## Filed Under: M&A, Preferred Shares

Definition of 'Weighted Average Cost Of Capital - WACC'

## A calculation of a firm's cost of capital in which each category of capital is

proportionately weighted. All capital sources - common stock, preferred stock,
bonds and any other long-term debt - are included in a WACC calculation. All
else equal, the WACC of a firm increases as the beta and rate of return on
equity increases, as an increase in WACC notes a decrease in valuation and
a higher risk.

The WACC equation is the cost of each capital component multiplied by its
proportional weight and then summing:

Where:

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 Re = cost of equity
 Rd = cost of debt
 E = market value of the firm's equity
 D = market value of the firm's debt
 V=E+D
 E/V = percentage of financing that is equity
 D/V = percentage of financing that is debt
 Tc = corporate tax rate

Businesses often discount cash flows at WACC to determine the Net Present
Value (NPV) of a project, using the formula:

## Broadly speaking, a company's assets are financed by either debt or equity.

WACC is the average of the costs of these sources of financing, each of
which is weighted by its respective use in the given situation. By taking a
weighted average, we can see how much interest the company has to pay for
every dollar it finances.

A firm's WACC is the overall required return on the firm as a whole and, as
such, it is often used internally by company directors to determine the
economic feasibility of expansionary opportunities and mergers. It is the
appropriate discount rate to use for cash flows with risk that is similar to that
of the overall firm.

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Credit Modalities

Fixed investment

This credit line finances investments in fixed necessary for products and
services production or commercialization processes, and to increase the
installed capacity, to develop industrial reconversion processes and
technological improvement of micro, small, medium and large enterprises
from all economic sectors.

Leasing

Through this mechanism Bancoldex provides funds for financial entities for
the amount of the financial leasing contracts entered into with micro, small,
medium and large enterprises from all economic sectors, in connection with
goods used for manufacturing or commercializing their products or services.

## This credit line finances capital contributions of partners or shareholders of

companies who benefit from BANCOLDEX credits.

## Comprises financing of contributions for creation of new companies,

acquisition of shares or corporate interest quotas to allow horizontal or
vertical integration, and increase of paid capital necessary for modernizing
and developing new projects of micro, small, medium and large enterprises
from all economic sectors.

Working capital

This credit line finances operational costs and expenses inherent to the
economic activity of enterprises such as raw materials, inventories, promotion
activities oriented towards entering, broadening or consolidating markets,
among others.

It is available for micro, small, medium and large enterprises from all
economic sectors.

Consolidation of liabilities

This credit line allows the re-composition of liabilities of micro, small, medium
and large enterprises from all economic sectors, with Bancoldex resources, of
their liabilities in force, in order to improve term conditions, rate or recurrent

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payment intervals.

## Special Credit Limits – Agreements

Aiming to focus financial support for the entrepreneurial sector, the Bank has
entered into several agreements with governmental entities such as
ministries, regional government offices, city halls, international cooperation
agencies, among others, in order to establish Special Credit Limits to provide
liquidity in pesos and or in dollars for different entrepreneurial sectors, in
accordance with their geographic location, their size or the destination of
resources, offering preferential financial conditions. These special Credit
Limits contemplate, as the case may be, limits for maximum financial
amounts for each company, as well as compliance of specific conditions to

## Through these Special Limits Bancoldex irrigates credit in accordance with

the entrepreneurial segment or region that may require a special support
mechanism; some credit limits have a national coverage and other have
regional coverage.

## Enterprises capitalization Support

Bancoldex Capital Program promotes the private equity and venture capital
industry in Colombia

Program Components

##  Financial support: investment in Private Equity and Venture Capital

Funds. Bancoldex does not invest directly in companies
 Non financial support : Bancóldex will contribute to the construction of
the ecosystem of the Industry of Private Equity and Venture Capital.
This in order to incorporate best practices in the industry, through
activities for investors, managers, companies and other industry
players

Main objectives

##  Make available to Colombian companies new sources of long-term

financing through fresh capital from the private equity funds
 Promote private equity and venture capital industry in the country

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 Attract new investors, local and foreign, to participate in the private
equity industry in the country

FUENTE: http://www.bancoldex.com/portal_ingles/Products-and-

Credit Modalities

Fixed investment

This credit line finances investments in fixed necessary for products and
services production or commercialization processes, and to increase the
installed capacity, to develop industrial reconversion processes and
technological improvement of micro, small, medium and large enterprises
from all economic sectors.

Leasing

Through this mechanism Bancoldex provides funds for financial entities for
the amount of the financial leasing contracts entered into with micro, small,
medium and large enterprises from all economic sectors, in connection with
goods used for manufacturing or commercializing their products or services.

## This credit line finances capital contributions of partners or shareholders of

companies who benefit from BANCOLDEX credits.

## Comprises financing of contributions for creation of new companies,

acquisition of shares or corporate interest quotas to allow horizontal or
vertical integration, and increase of paid capital necessary for modernizing
and developing new projects of micro, small, medium and large enterprises
from all economic sectors.

Working capital

This credit line finances operational costs and expenses inherent to the
economic activity of enterprises such as raw materials, inventories, promotion

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activities oriented towards entering, broadening or consolidating markets,
among others.

It is available for micro, small, medium and large enterprises from all
economic sectors.

Consolidation of liabilities

This credit line allows the re-composition of liabilities of micro, small, medium
and large enterprises from all economic sectors, with Bancoldex resources, of
their liabilities in force, in order to improve term conditions, rate or recurrent
payment intervals.

## Special Credit Limits - Agreements

Aiming to focus financial support for the entrepreneurial sector, the Bank has
entered into several agreements with governmental entities such as
ministries, regional government offices, city halls, international cooperation
agencies, among others, in order to establish Special Credit Limits to provide
liquidity in pesos and or in dollars for different entrepreneurial sectors, in
accordance with their geographic location, their size or the destination of
resources, offering preferential financial conditions. These special Credit
Limits contemplate, as the case may be, limits for maximum financial
amounts for each company, as well as compliance of specific conditions to

## Through these Special Limits Bancoldex irrigates credit in accordance with

the entrepreneurial segment or region that may require a special support
mechanism; some credit limits have a national coverage and other have
regional coverage.

## Enterprises capitalization Support

Bancoldex Capital Program promotes the private equity and venture capital
industry in Colombia

Program Components

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Financial support: investment in Private Equity and Venture Capital Funds.
Bancoldex does not invest directly in companies

## Non financial support : Bancóldex will contribute to the construction of the

ecosystem of the Industry of Private Equity and Venture Capital. This in order
to incorporate best practices in the industry, through activities for investors,
managers, companies and other industry players

Main objectives

## Make available to Colombian companies new sources of long-term financing

through fresh capital from the private equity funds

## Promote private equity and venture capital industry in the country

Attract new investors, local and foreign, to participate in the private equity
industry in the country.

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What is Breakeven Point?

A company's breakeven point is the point at which its sales exactly cover its
expenses. The company sells enough units of its product to cover its
expenses without making a profit or taking a loss. If it sells more, then it
makes a profit. On the other hand, if it sells less, it takes a loss.

## To compute a company's breakeven point in sales volume, you need to know

the values of three variables. Those three variables are fixed costs, variable
costs, and the price of the product. Fixed costs are those which do not
change with the level of sales, such as overhead. Variable costs are those
which do change with the level of sales, such as cost of goods sold. The price
of the product has been set by the company through looking at the wholesale
cost of the product, or the cost of manufacturing the product, and marking it
up.

formula:

## Fixed Costs/Price - Variable Costs = Breakeven Point in Units

In this formula, fixed costs are stated as a total -- the total fixed costs for the
firm. Basically, this means the total overhead for the firm. Price and variable
costs, however, are stated as per unit costs - the price for each product sold
and the variable cost for that unit of the product. The denominator of the
equation, price minus variable costs, is called the contribution margin. In other
words, this is the amount, per unit of product sold, that the firm can contribute
to paying its fixed costs.

## An Example of Breakeven Point

XYZ Corporation has calculated that it has fixed costs that consist of its lease,
depreciation of its assets, executive salaries, and property taxes. Those fixed
costs add up to \$60,000. Their product is the widget. Their variable costs
associated with producing the widget are raw material, factory labor, and
sales commissions. Variable costs have been calculated to be \$0.80 per unit.
The widget is priced at \$2.00 each.

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Given this information, we can calculate the breakeven point for XYZ
Corporation's product, the widget

FUENTE:

## What is Breakeven Point?

A company's breakeven point is the point at which its sales exactly cover its
expenses. The company sells enough units of its product to cover its
expenses without making a profit or taking a loss. If it sells more, then it
makes a profit. On the other hand, if it sells less, it takes a loss.

## To compute a company's breakeven point in sales volume, you need to know

the values of three variables. Those three variables are fixed costs, variable
costs, and the price of the product. Fixed costs are those which do not
change with the level of sales, such as overhead. Variable costs are those
which do change with the level of sales, such as cost of goods sold. The price
of the product has been set by the company through looking at the wholesale
cost of the product, or the cost of manufacturing the product, and marking it
up.

formula:

## Fixed Costs/Price - Variable Costs = Breakeven Point in Units

In this formula, fixed costs are stated as a total -- the total fixed costs for the
firm. Basically, this means the total overhead for the firm. Price and variable
costs, however, are stated as per unit costs - the price for each product sold
and the variable cost for that unit of the product. The denominator of the
equation, price minus variable costs, is called the contribution margin. In other
words, this is the amount, per unit of product sold, that the firm can contribute
to paying its fixed costs.

## An Example of Breakeven Point

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XYZ Corporation has calculated that it has fixed costs that consist of its lease,
depreciation of its assets, executive salaries, and property taxes. Those fixed
costs add up to \$60,000. Their product is the widget. Their variable costs
associated with producing the widget are raw material, factory labor, and
sales commissions. Variable costs have been calculated to be \$0.80 per unit.
The widget is priced at \$2.00 each.

Given this information, we can calculate the breakeven point for XYZ
Corporation's product, the widget.

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