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FINANCIAL MODELING TEST
QUESTIONS WITH ANSWE RS
Question 1: Ignoring the impact of stock based
compensation expense included in cost of sales, what is gross profit for the year ending 1/30/2016?
CORRECT ANSWER: $1,323,734
Question 2: What is depreciation expense for the year
ending 1/30/2016?
CORRECT ANSWER: $140.6 Million
Question 3: What is AEO's share count on 3/7/2016?
CORRECT ANSWER: 180.7 million
Question 4: As of 1/30/2016, what is the sum of the next
- years' amortization expenses of AEO's intangible
assets?
CORRECT ANSWER: 17.3 million
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Question 5: What is gross profit for the year ending
1/31/2023?
CORRECT ANSWER: $1,709,188
Question 6: What is SG&A for the year ending
1/31/2023?
CORRECT ANSWER: $1,298,397
Question 7: What is D&A for the year ending 1/31/2025?
CORRECT ANSWER: $240,500
Question 8: For the purpose of this question only, instead
of assuming a 20-year useful life for intangible assets, assume a 4-year useful life for all newly purchased intangible assets in the forecast period. What is amortization expense for the year ending 1/31/2025?
CORRECT ANSWER: $6,911
Question 9: What is the balance of total current assets
excluding cash minus total current liabilities as of
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1/31/2025. Remember to reset your model to remove assumptions unique to the last question!
CORRECT ANSWER: $83,422
Question 10: What is the difference between cash from
operations and net income in the year ended 1/31/2023?
CORRECT ANSWER: $252,623
Question 11: What is cash from investing activities in the
year ended 1/31/2023?
CORRECT ANSWER: ($219,647)
Question 12: What is the first year of the forecast where
AEO does NO buybacks?
CORRECT ANSWER: 01/31/21
Question 13: In what year of the forecast does AEO need
to draw on the revolver for the first time?
CORRECT ANSWER: 01/31/22
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Question 14: What is interest expense in the year ending
1/31/2026?
CORRECT ANSWER: $6,171
Question 15: What are total assets as of 1/31/26?
CORRECT ANSWER: $1,804,243
Question 16: Assuming for the purpose of this question
only that there are no buybacks during any forecast year, what is the basic share count on 1/31/2026?
CORRECT ANSWER: $203,663
Question 17: Calculate depreciation expense for the year
ending 12/31/2018.
CORRECT ANSWER: $10,777
Question 18: What is the useful life of the existing
PP&E? (Round to nearest whole number.)