BCOR 2200 Chapter 1 - Chapter 1 Introduction 1 Chapter 1...

Info icon This preview shows pages 1–7. Sign up to view the full content.

View Full Document Right Arrow Icon
Chapter 1 Introduction 1
Image of page 1

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

View Full Document Right Arrow Icon
Chapter 1 Outline: A Quick Look Business Finance and The Financial Manager Forms of Business Organization The Goal of Financial Management The Agency Problem and Control of the Corporation Financial Markets and the Corporation 2
Image of page 2
1.1 A Quick Look Four Basic Areas of Finance 1.Corporate Finance A. Capital Budgeting – Do a proposed project? B. How do you pay for the project? (Three choices) C. Working Capital Management 2.Investments 3.Financial Institutions 4.International Finance Lets go over these in more detail
Image of page 3

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

View Full Document Right Arrow Icon
Four Basic Areas of Finance 1.Corporate Finance A. Capital Budgeting – Do a proposed project? You have an idea. Will it make money? Will the idea “Increase the firm’s value” How many units can we sell? (Marketing) How much will it cost to make the units? (Operations) B. How do you pay for the project? (Three choices) 1. Sell a piece of the company Sell an Equity stake a.k.a. sell stock 2. Borrow the money Sell Debt securities a.k.a. sell bonds 3. Retain Earnings Keep past profits to finance expansion 4
Image of page 4
1. Corporate Finance (Continued) A. Working Capital Management Make Sure there is enough cash and inventory on hand. The BLUE ones are Working capital accounts Too Much Cash? Payoff ST Debt (Lower Interest Expense) Not Enough cash? Borrow More (Increase Interest Expense) Assets Liabilities & Equity Cash ST Debt Inventory A/P A/R LT Debt PPE Equity 5
Image of page 5

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

View Full Document Right Arrow Icon
1. Investments Firms sell securities (stocks and bonds) Someone buys them Which ones should you buy? What are the worth? This is called Securities Analysis If I hold a bunch of different securities called a portfolio ), how do the different securities combine into portfolios?
Image of page 6
Image of page 7
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern