Chapter1 - Introduction to Financial Management Definitions...

Info iconThis preview shows pages 1–6. Sign up to view the full content.

View Full Document Right Arrow Icon
Slide 1 Introduction to Financial Management Definitions of Finance Financial Management Decisions and The Goal Forms of Business Organizations The Corporation and Financial Markets Ten Principles of Finance
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Slide 2 Definition of Finance Finance is the study of how people allocate scarce resources over time. Two characteristics of financial decisions; Costs and benefits of financial decisions are spread out over time Costs and benefits are not known in advance Finance consists of concepts to help you organize your decision making process and quantitative models to help you evaluate alternatives
Background image of page 2
Slide 3 Financial Management Decisions and The Goal Capital Budgeting: What assets should be acquired? Capital Structure: What is the best way of financing the assets? Working Capital Management: Short-term asset and liability management
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Slide 4 Financial Management Decisions and The Goal (Continued) The Goal of Financial Managers Maximize profits How to define profits Risks associated with maximizing profits are ignored Profits of this year or the next should be maximized? Maximize the market value of the existing owners’ equity
Background image of page 4
Slide 5 Forms of Business Organization Ownership Form Ease of Formation Ability to Raise Funds Management Personal Liability Income Tax Treatment Transfer of Ownership Dissolution Individual (Sole Simple and inexpensive Limited Flexible, independent, may lack expertise Unlimited Single Simple and inexpensive Excellent General Partnership Moderately easy Limited but superior to individual ownership Designated partners Unlimited Single Poor Fairly simple Limited Partnership Moderately difficult and expensive Limited but superior to general partnership
Background image of page 5

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 6
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 22

Chapter1 - Introduction to Financial Management Definitions...

This preview shows document pages 1 - 6. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online