How to love models

Financial Modeling in Google Sheets

Erin Buchanan

Professor

What is a model?

• A representation of the "real world"
• Quantitative or mathematical model displaying financial information
• Might include:
  • Income statements
  • Cash flows
  • Stock values

What is a model?

• A representation of the "real world"
• Quantitative or mathematical model displaying financial information
• Might include:
  • Income statements
  • Cash flows
  • Stock values

Income statements

• Sales: Money made from business
• Costs: Money spent during business
• EBIT: Earnings before interest and taxes
• Taxes: Income taxes or other expenses
• Net Income: Money made after adjusting for expenses
• Dividends: Money paid to shareholders

Adding up the bill

=sum(CELL REFERENCES)

=sum(B8, B10:B12)

Make your first model!

Financial Modeling in Google Sheets