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Unformatted text preview: amp; Poor’s 500 Index.
Despite the U.S. economic slowdown in 2001, the company expects to keep its growth perking over the next five years. Although some fear that Starbucks has saturated the domestic market, same-store sales keep rising as the company introduces new products. Starbucks has even
become quite successful in unexpected markets, such as Japan.
Accomplishing its business objectives while building shareholder value requires sound
financial management—raising funds to open new stores and build more roasting plants, deciding when and where to put them, managing cash collections, reducing purchasing costs, and
dealing with fluctuations in the value of foreign currency and with other risks as it buys coffee
beans and expands overseas. To finance its growth, Starbucks went public (sold common stock)
in 1992, and its stock trades on the Nasdaq national market. Its next securities offering was the
sale of convertible bonds, debt securities that could be converted into common stock at a specified price. Those bonds were successfully converted into common stock by 1996, and today the
company has almost no long-term debt.
Like Starbucks, every company must deal with many different issues to keep its financial
condition solid. Chapter 1 introduces managerial finance and its key role in helping an organization meet its financial and business objectives. S 3 4 PART 1 Introduction to Managerial Finance LG1 1.1 Finance and Business
The field of finance is broad and dynamic. It directly affects the lives of every person and every organization. There are many areas and career opportunities in the
field of finance. Basic principles of finance, such as those you will learn in this
textbook, can be universally applied in business organizations of different types. What Is Finance?
The art and science of managing
money. Finance can be defined as the art and science of managing money. Virtually all
individuals and organizations earn or raise money and spend or invest money.
Finance is concerned with the process, institutions, markets, and instruments
involved in the transfer of money among individuals, businesses...
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- Fall '13