Finance

Licensing Information

This text was adapted by #OpenCourseWare under an Attribution-ShareAlike 4.0 International (CC BY-SA 4.0)

Chapter 1: Introduction to the Field and Goals of Financial Management

  • Introducing Finance
  • Goals of Financial Management
  • Trends and Issues in Finance
  • Ethics: An Overview
  • Types of Business Organizations
  • Corporate Governance
  • Agency and Conflicts of Interest
  • Asset Classes
  • Financial Markets

Chapter 2: Financial Statements, Taxes, and Cash Flow

  • Introducing Financial Statements
  • The Income Statement
  • The Balance Sheet
  • Tax Considerations
  • The Statement of Cash Flows
  • Other Statements

Chapter 3: Analyzing Financial Statements

  • Standardizing Financial Statements
  • Overview of Ratio Analysis
  • Profitability Ratios
  • Asset Management Ratios
  • Liquidity Ratios
  • Debt Management Ratios
  • Market Value Ratios
  • The DuPont Equation, ROE, ROA, and Growth
  • Using Financial Ratios for Analysis
  • Considering Inflation’s Distortionary Effects

Chapter 4: Forecasting Financial Statements

  • The Role of Financial Forecasting in Planning
  • Overview of Forecasting
  • Forecasting the Income Statement
  • Forecasting the Balance Sheet
  • Building a Cash Budget
  • Analyzing Forecasts

Chapter 5: The Time Value of Money

  • Introduction to the Time Value of Money
  • Future Value, Single Amount
  • Present Value, Single Amount
  • Annuities
  • Valuing Multiple Cash Flows
  • Additional Detail on Present and Future Values
  • Yield

Chapter 6: Bond Valuation

  • The Basics of Interest Rates
  • Additional Detail on Interest Rates
  • Key Characteristics of Bonds
  • Understanding Bonds
  • Advantages and Disadvantages of Bonds
  • Types of Bonds
  • Bond Markets
  • Valuing Bonds
  • Bond Risk

Chapter 7: Stock Valuation

  • Defining Stock
  • Types of Stock
  • Rules and Rights of Common and Preferred Stock
  • Stock Markets
  • Stock Valuation
  • Valuing the Corporation

Chapter 8: Introduction to Risk and Return

  • Understanding Return
  • Portfolio Considerations
  • The Impact of News of Expected Returns
  • Risk
  • Implications Across Portfolios
  • Diversification
  • Understanding the Security Market Line

Chapter 9: Security Market Efficiency and Returns

  • The Security Markets
  • Understanding Returns
  • Market Efficiency
  • Market Regulation

Chapter 10: Introduction to the Cost of Capital

  • The Basics of the Cost of Capital
  • Valuing Different Costs
  • Approaches to Calculating the Cost of Capital
  • The WACC

Chapter 11: Capital Budgeting

  • Introduction to Capital Budgeting
  • The Payback Method
  • Internal Rate of Return
  • Net Present Value
  • Cash Flow Analysis and Other Factors

Chapter 12: The Role of Risk in Capital Budgeting

  • The Relationship Between Risk and Capital Budgeting
  • Assessing Stand-Alone Risk
  • Risk and Return
  • Scenario and Simulation Assessments
  • Factors Impacting Capital Budgeting
  • Other Considerations in Capital Budgeting

Chapter 13: Capital Structure

  • Introducing Capital Structure
  • Capital Structure Considerations
  • Understanding the Bankruptcy Process
  • Thinking About Operating Leverage
  • Thinking About Financial Leverage

Chapter 14: Obtaining Capital: Methods of Long-Term Financing

  • Types of Financing
  • Venture Capital
  • Leasing
  • The Role of Investment Banks in Financing
  • Distributing Stock
  • Comparing Public and Private Financing

Chapter 15: Dividends

  • Introduction to Dividends
  • Dividend Policy
  • Setting the Dividend
  • Cash Dividend Alternatives

Chapter 16: Options and Corporate Finance

  • Convertible Securities
  • Options
  • Warrants
  • Derivatives
  • Managing Risk with Derivatives

Chapter 17: Introduction to Working Capital

  • Working Capital
  • Approaches to Working Capital Financing
  • Overview of the Working Capital Financing Decision

Chapter 18: Working Capital Management

  • The Importance of Cash
  • Cash Management
  • Securities Management
  • Accounts Receivable
  • Inventory Management

Chapter 19: Overview of Short-Term Financing

  • Short-Term Financing

Chapter 20: Mergers and Acquisitions

  • Types of Transactions
  • Preparing for a Merger
  • The Role of Investment Bankers in M&A
  • Additional Topics in M&A

Chapter 21: Financial Management Outside of the U.S.

  • Types of International Business
  • The International Business Environment
  • Factors Impacting Exchange Rates
  • Types of Rates and Transactions
  • Managing Exchange Risk
  • International Investment and Finance