#### Overview of this book

Financial modeling is a core skill required by anyone who wants to build a career in finance. Hands-On Financial Modeling with Microsoft Excel 2019 explores terminologies of financial modeling with the help of Excel. This book will provides you with an overview of the steps you should follow to build an integrated financial model. You will explore the design principles, functions, and techniques of building models in a practical manner. Starting with the key concepts of Excel, such as formulas and functions, you will learn about referencing frameworks and other advanced components for building financial models. Later chapters will help you understand your financial projects, build assumptions, and analyze historical data to develop data-driven models and functional growth drivers. The book takes an intuitive approach to model testing and covers best practices and practical use cases. By the end of this book, you will have examined the data from various use cases, and have the skills you need to build financial models to extract the information required to make informed business decisions.
Preface
Free Chapter
Section 1: Financial Modeling - Overview
Introduction to Financial Modeling and Excel
Steps for Building a Financial Model
Section 2: The Use of Excel - Features and Functions for Financial Modeling
Formulas and Functions - Completing Modeling Tasks with a Single Formula
Applying the Referencing Framework in Excel
Section 3: Building an Integrated Financial Model
Understanding Project and Building Assumptions
Asset and Debt Schedules
Cash Flow Statement
Valuation
Model Testing for Reasonableness and Accuracy
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# Debt schedule

A company's capital is made up of debt and equity, and most businesses try to maintain a steady ratio between debt and equity (a leverage ratio). The debt schedule is part of our forecast of capital structure.

The following list shows our current agenda:

• Record the historical profit and loss accounts and balance sheet
• Calculate the historical growth drivers
• Project the growth drivers for the profit and loss accounts and balance sheet
• Build up the projected profit and loss accounts and balance sheet
• Prepare the asset and depreciation schedule
• Prepare the debt schedule
• Prepare the cash flow statement
• Ratio analysis
• DCF valuation
• Other valuations
• Scenario analysis

As with fixed assets, forecasting debt can be done in one of two ways; a detailed complex method or a quick and simple method.

In addition, we need to consider the treatment of interest. The question...