Finance term for test 2

Finance term for test 2 - Finance term for test 2 Financial...

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Finance term for test 2 - Financial managers o Use the financial data and other info prepared by the accountants to make financial decisions o Focus on cash flows – manage the firm’s money so it can meet its goals o Finance issues at the firm level: funding needs and sources in the short term and long term o Financial managers are involved in What are the forms funding needs Where will the funds come from Should a new project be implemented Should the new stock issue be sold Should dividends be increased How should the firm invest its working capital Financial planning Financial control Cash flow management - Investment managers o The securities markets: opportunities for funding and investments - Cash flows o Cash comes in : sales, investments, bank, o Cash out: supplies, utilities, bank, workers, taxes - Working capital management o Managing of short term assets and liabilities because they continually flow through an organization = “working” - Leverage o The use of debt to increase profit
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- Capital structure o Relative mix of firms debt and equity financing - Transaction balances o Cash kept on hand by a firm to pay normal daily expenses, such as employee wages and bills for supplies and utilities - Lockbox o An address, usually a commercial bank at which a company receives payments in order to speed collections from customers - Marketable securities o Temporary investment of extra cash by organizations for up to o ne year in U.S treasury bills, certificates of deposit, or Eurodollar loans - Treasury bills o Short term debt obligations the US government sells to raise money - Commercial certificates of deposit o Certificates of deposit issued by commercial banks and brokerage companies available in minimum amounts of 100,000 which may be traded prior to matuity - Commercial paper o A written promise from one company to another to pay a specific amount of money - Eurodollar market o A market for trading U.S dollars - Trade credit o Credit extended by suppliers for the Purchase of their goods and services - Line of credit o An arrangement by which a bank agrees to lend a specified amount of money to an
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This note was uploaded on 04/03/2008 for the course BCOR 1010 taught by Professor Latier,jef during the Fall '07 term at Colorado.

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Finance term for test 2 - Finance term for test 2 Financial...

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