Acc501 handouts
BUSINESS FINANCE
The Primary textbook for the course is:
Essentials of Corporate Finance, by Ross, Westerfield and Jordan, fourth edition, McGraw
Hill Publishers, ISBN 0-07-121057-7
Reference books will be:
Introduction to Finance by Lawrence J. Gitman and Jeff Madura, Addison-Wesley Publishers
Foundations of Financial Management by Stanley B. Block and Geoffrey A. Hirt, McGraw
Hill Publishers
Course Contents
An overview of Financial Environment
Financial Statements, Taxes and Cash Flows
Time Value of Money and Discounted Cash Flow Valuation
Valuation of Stocks and Bonds
Net Present Value and other Investment Criteria
Capital Investment Decision
Risk and Return
Cost of Capital
Leverage and Capital Structure
Raising Capital
Working Capital Management
Dividends
Finance: A Quick Look
Four Basic Areas
o Business Finance
o Investments
o Financial Institutions
o International Finance
Business Finance
Addresses the following three questions:
What long-term investments should the firm engage in?
How can the firm raise the money for the required investments?
How much short-term cash flow does a company need to pay its bills?
Investments
Deals with financial assets such as stocks and bonds.
It covers the following issues:
o Pricing Financial Assets
o Associated Risks and Rewards
o Determining best mixture of financial investment
Career opportunities in investment
o Stock Brokerage
o Portfolio Management
o Security Analysis
Financial Institutions
Businesses dealing in financial matters
o Banks and Insurance companies
International Finance
Covers international aspects of corporate finance, investment and financial institutions.
