Study guide Fundamentals of financial management:
Gespeichert in:
| Beteiligte Personen: | , , |
|---|---|
| Format: | Buch |
| Sprache: | Englisch |
| Veröffentlicht: |
Mason, Ohio
Thomson/South-Western
2007
|
| Ausgabe: | 11. ed. |
| Schlagwörter: | |
| Links: | http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=015586396&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA |
| Umfang: | IX, 462 S. graph. Darst. |
| ISBN: | 032430269x |
Internformat
MARC
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| 100 | 1 | |a Brigham, Eugene F. |d 1930- |e Verfasser |0 (DE-588)124803059 |4 aut | |
| 245 | 1 | 0 | |a Study guide Fundamentals of financial management |c Eugene F. Brigham ; Joel F. Houston. Prepared by Dana Aberwald Clark |
| 246 | 1 | 3 | |a Fundamentals of financial management |
| 250 | |a 11. ed. | ||
| 264 | 1 | |a Mason, Ohio |b Thomson/South-Western |c 2007 | |
| 300 | |a IX, 462 S. |b graph. Darst. | ||
| 336 | |b txt |2 rdacontent | ||
| 337 | |b n |2 rdamedia | ||
| 338 | |b nc |2 rdacarrier | ||
| 650 | 7 | |a Entreprises - Finances - Problèmes et exercices |2 ram | |
| 650 | 4 | |a Corporations |x Finance |x Problems, exercises, etc | |
| 650 | 0 | 7 | |a Finanzmanagement |0 (DE-588)4139075-1 |2 gnd |9 rswk-swf |
| 689 | 0 | 0 | |a Finanzmanagement |0 (DE-588)4139075-1 |D s |
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| 700 | 1 | |a Houston, Joel F. |e Verfasser |4 aut | |
| 700 | 1 | |a Clark, Dana Aberwald |e Verfasser |4 aut | |
| 856 | 4 | 2 | |m HBZ Datenaustausch |q application/pdf |u http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=015586396&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA |3 Inhaltsverzeichnis |
| 943 | 1 | |a oai:aleph.bib-bvb.de:BVB01-015586396 | |
Datensatz im Suchindex
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| adam_text | BRIEF CONTENTS
Preface iii
Part 1 Introduction to Financial Management 1
Chapter 1 An Overview of Financial Management 2
Part 2 Fundamental Concepts in Financial Management 23
Chapter 2 Time Value of Money 24
Chapter 3 Financial Statements, Cash Flow, and Taxes 64
Chapter 4 Analysis of Financial Statements 100
Chapter 5 Financial Markets and Institutions 141
Part 3 Financial Assets 173
Chapter 6 Interest Rates 174
Chapter 7 Bonds and Their Valuation 207
Chapter 8 Risk and Rates of Return 244
Chapter 9 Stocks and Their Valuation 289
Part 4 Investing in Long Term Assets: Capital Budgeting 327
Chapter 10 The Cost of Capital 328
Chapter 11 The Basics of Capital Budgeting 357
Chapter 12 Cash Flow Estimation and Risk Analysis 387
Chapter 13 Real Options and Other Topics in Capital Budgeting 415
Part 5 Capital Structure and Dividend Policy 435
Chapter 14 Capital Structure and Leverage 436
Chapter 15 Distributions to Shareholders: Dividends and Share Repurchases 478
Brief Contei
Part 6 Working Capital and Financial Planning 511
Chapter 16 Working Capital Management 512
Chapter 17 Financial Planning and Forecasting 552
Part 7 Special Topics in Financial Management 577
Chapter 18 Derivatives and Risk Management 578
Chapter 19 Multinational Financial Management 615
Chapter 20 Hybrid Financing: Preferred Stock, Leasing, Warrants,
and Convertibles 648
Chapter 21 Mergers and Acquisitions 683
Appendixes
Appendix A Solutions to Self Test Questions and Problems A 1
Appendix B Answers to Selected End of Chapter Problems A 27
Appendix C Selected Equations and Data A 30
Index 1 1
CONTENTS
PREFACE iii
Part 1
Introduction to Financial Management 1
, . ; • i . * *¦ !
¦ ¦¦¦•)¦ •¦•
An Overview of Financial Management 2
Striking the Right Balance 2
PUTTING THINGS IN PERSPECTIVE 3
1.1 Forms of Business Organization 4
1.2 Stock Prices and Shareholder Value 6
1.3 Intrinsic Values, Stock Prices, and
Compensation Plans 8
1.4 Some Important Trends 11
¦ Is Shareholder Wealth Maximization
a Worldwide Goal? 12
1.5 Business Ethics 12
What Companies Are Doing 13
Consequences of Unethical Behavior 13
How Should Employees Deal with Unethical
Behavior? 14
¦ Protection for Whistle Blowers 15
1.6 Conflicts between Managers and
Stockholders 16
1.7 The Role of Finance in the Organization 17
TYING IT ALL TOGETHER 18
Part 2
Fundamental Concepts in Financial
Management 23
Time Value of Money 24
Will You Be Able to Retire? 24
PUTTING THINGS IN PERSPECTIVE 24
2.1 Time Lines 25
2.2 Future Values 26
1. Step by Step Approach 27
2. Formula Approach 27
xxii
¦ Simple versus Compound Interest 27
3. Financial Calculators 28
4. Spreadsheets 28
¦ Hints on Using Financial Calculators 29
Graphic View of the Compounding Process 30
2.3 Present Values 31
Graphic View of the Discounting Process 33
2.4 Finding the Interest Rate, I 34
2.5 Finding the Number of Years, N 35
2.6 Annuities 35
2.7 Future Value of an Ordinary Annuity 36
2.8 Future Value of an Annuity Due 38
2.9 Present Value of an Ordinary Annuity 39
2.10 Finding Annuity Payments, Periods, and
Interest Rates 40
Finding Annuity Payments, PMT 40
Finding the Number of Periods, N 41
Finding the Interest Rate, I 41
2.11 Perpetuities 42
2.12 Uneven Cash Flows 44
2.13 Future Value of an Uneven Cash Flow
Stream 46
2.14 Solving for I with Uneven
Cash Flows 47
2.15 Semiannual and Other Compounding
Periods 48
2.16 Comparing Interest Rates 50
2.17 Fractional Time Periods 52
2.18 Amortized Loans 52
TYING IT ALL TOGETHER 54
INTEGRATED CASE
First National Bank 62
WEB APPENDIX 2A
Continuous Compounding and Discounting
Financial Statements, Cash Flow,
and Taxes 64
Doing Your Homework with Financial Statements 64
PUTTING THINGS IN PERSPECTIVE 65
3.1 A Brief History of Accounting and
Financial Statements 65
3.2 Financial Statements and Reports 66
3.3 The Balance Sheet 68
3.4 The Income Statement 72
3.5 Net Cash Flow 75
3.6 Statement of Cash Flows 75
¦ Massaging the Cash Flow
Statement 78
3.7 Statement of Retained Earnings 78
3.8 Uses and Limitations of Financial
Statements 79
¦ Financial Analysis on the Internet 80
3.9 Modifying Accounting Data for Investor
and Managerial Decisions 81
Operating Assets and Operating Capital 81
Operating Cash Flows 84
Free Cash How 84
3.10 MVA and EVA 86
3.11 The Federal Income Tax System 87
Corporate Taxes 87
Personal Taxes 87
Interest Paid 87
Interest Earned 88
Dividends Paid 88
Dividends Received 88
Tax Loss Carry Back and Carry Forward 88
Capital Gains 88
Depreciation 89
Small Businesses 89
TYING IT ALL TOGETHER 89
INTEGRATED CASE
D Leon Inc., Part I 95
WEB APPENDIX 3A
The Federal Income Tax System
Analysis of Financial Statements 100
Lessons Learned from Enron and WorldCom 100
PUTTING THINGS IN PERSPECTIVE 102
4.1 Ratio Analysis 102
4.2 Liquidity Ratios 103
Current Ratio 103
Quick, or Acid Test, Ratio 104
Contents I xxiii
4.3 Asset Management Ratios 104
Inventory Turnover Ratio 105
Days Sales Outstanding 106
Fixed Assets Turnover Ratio 106
Total Assets Turnover Ratio 107
4.4 Debt Management Ratios 108
Total Debt to Total Assets 110
Times Interest Earned Ratio 110
EBITDA Coverage Ratio 111
4.5 Profitability Ratios 112
Profit Margin on Sales 112
¦ Global Perspectives: Global Accounting
Standards: Can One Size Fit All? 113
Return on Total Assets 114
Basic Earning Power (BEP) Ratio 114
Return on Common Equity 115
4.6 Market Value Ratios 115
Price/Earnings Ratio 116
Price/Cash Flow Ratio 116
Market/Book Ratio 116
4.7 Trend Analysis 118
4.8 Tying the Ratios Together: The Du Pont
Equations 118
4.9 Comparative Ratios and
Benchmarking 121
¦ Looking for Warning Signs within
the Financial Statements 123
4.10 Uses and Limitations of Ratio Analysis 124
4.11 Problems with ROE 125
¦ EVA and ROE 126
4.12 Looking Beyond the Numbers 128
TYING IT ALL TOGETHER 129
INTEGRATED CASE
D Leon Inc., Part II 1 36
Financial Markets and Institutions 141
A Strong Financial System Is Necessary for a Growing
and Prosperous Economy 141
PUTTING THINGS IN PERSPECTIVE 142
5.1 An Overview of the Capital Allocation
Process 143
5.2 Financial Markets 145
Types of Markets 145
Recent Trends 146
xxiv I Contents
5.3 Financial Institutions 148
5.4 The Stock Market 153
¦ Citigroup Built to Compete in a Changing
Environment 154
The Physical Location Stock Exchanges 154
¦ The NYSE and Nasdaq Combine Forces with
the Leading Online Trading Systems 155
The Over the Counter and the Nasdaq Stock
Markets 156
5.5 The Market for Common Stock 157
Types of Stock Market Transactions 157
5.6 Stock Markets and Returns 160
Stock Market Reporting 160
Stock Market Returns 162
5.7 Stock Market Efficiency 163
Levels of Market Efficiency 163
¦ Measuring the Market 164
Implications of Market Efficiency 166
Is the Stock Market Efficient? 167
¦ A Closer Look at Behavioral Finance
Theory 168
TYING IT ALL TOGETHER 169
INTEGRATED CASE
Smyth Barry Company, Part I 170
Part 3
Financial Assets 173
Interest Rates 174
Low Interest Rates Encourage Investment and Stimulate
Consumer Spending 174
PUTTING THINGS IN PERSPECTIVE 175
6.1 The Cost of Money 175
6.2 Interest Rate Levels 176
6.3 The Determinants of Market Interest
Rates 180
The Real Risk Free Rate of Interest, r* 181
The Nominal, or Quoted, Risk Free Rate of
Interest, rRF 182
Inflation Premium (IP) 182
Default Risk Premium (DRP) 183
¦ An Almost Riskless Treasury Bond 184
Liquidity Premium (LP) 186
Maturity Risk Premium (MRP) 186
6.4 The Term Structure of Interest Rates 187
6.5 What Determines the Shape of the Yield
Curve? 189
¦ The Links between Expected Inflation
and Interest Rates: A Closer Look 192
6.6 Using the Yield Curve to Estimate Future
Interest Rates 193
6.7 Other Factors that Influence Interest Rate
Levels 196
Federal Reserve Policy 196
Federal Budget Deficits or Surpluses 196
International Factors 197
Business Activity 197
¦ Global Perspectives: Measuring
Country Risk 198
6.8 Investing Overseas 199
6.9 Interest Rates and Business
Decisions 199
TYING IT ALL TOGETHER 201
INTEGRATED CASE
Smyth Barry Company, Part II 206
Bonds and Their Valuation 207
Sizing Up Risk in the Bond Market 207
PUTTING THINGS IN PERSPECTIVE 208
7.1 Who Issues Bonds? 208
7.2 Key Characteristics of Bonds 209
Par Value 210
Coupon Interest Rate 210
Maturity Date 210
Call Provisions 211
Sinking Funds 211
Other Features 212
7.3 Bond Valuation 213
7.4 Bond Yields 216
Yield to Maturity 216
Yield to Call 217
Current Yield 218
7.5 Changes in Bond Values Over Time 218
7.6 Bonds with Semiannual Coupons 222
7.7 Assessing a Bond s Riskiness 223
Interest Rate Risk 223
Reinvestment Rate Risk 225
Comparing Interest Rate and Reinvestment Rate
Risk 226
7.8 Default Risk 227
Various Types of Corporate Bonds 228
Bond Ratings 229
Bankruptcy and Reorganization 233
7.9 Bond Markets 234
TYING IT ALL TOGETHER 236
INTEGRATED CASE
Western Money Management Inc. 243
WEB APPENDIX 7A
Zero Coupon Bonds
WEB APPENDIX 7B
Bankruptcy and Reorganization
Risk and Rates of Return 244
No Pain No Gain 244
PUTTING THINGS IN PERSPECTIVE 245
8.1 Stand Alone Risk 246
Probability Distributions 247
Expected Rate of Return 248
Measuring Stand Alone Risk: The Standard
Deviation 250
Using Historical Data to Measure Risk 252
Measuring Stand Alone Risk: The Coefficient
of Variation 254
Risk Aversion and Required Returns 255
¦ The Trade Off between Risk and Return 256
8.2 Risk in a Portfolio Context 257
Expected Portfolio Returns, rp 258
Portfolio Risk 259
¦ The Benefits of Diversification Are More
Important Than Ever 263
Diversifiable Risk versus Market Risk 263
The Concept of Beta 266
¦ Global Perspectives: The Benefits
of Diversifying Overseas 270
8.3 The Relationship between Risk and Rates
of Return 271
¦ Estimating the Market Risk Premium 272
The Impact of Inflation 275
Changes in Risk Aversion 275
Changes in a Stock s Beta Coefficient 277
8.4 Some Concerns about Beta and
the CAPM 277
8.5 Some Concluding Thoughts: Implications
for Corporate Managers and Investors 278
Contents xxv
TYING IT ALL TOGETHER 280
INTEGRATED CASE
Merrill Finch Inc. 286
WEB APPENDIX 8A
Calculating Beta Coefficients
Stocks and Their Valuation 289
Searching for the Right Stock 289
PUTTING THINGS IN PERSPECTIVE 290
9.1 Legal Rights and Privileges of Common
Stockholders 290
Control of the Firm 290
The Preemptive Right 291
9.2 Types of Common Stock 292
9.3 Common Stock Valuation 292
Definitions of Terms Used in Stock Valuation
Models 293
Expected Dividends as the Basis for Stock
Values 294
9.4 Constant Growth Stocks 296
Illustration of a Constant Growth
Stock 296
Dividend and Earnings Growth 297
When Can the Constant Growth Model
Be Used? 298
9.5 Expected Rate of Return on a Constant
Growth Stock 299
9.6 Valuing Stocks Expected to Grow at a
Nonconstant Rate 300
¦ Evaluating Stocks That Don t Pay
Dividends 304
9.7 Valuing the Entire Corporation 305
The Corporate Valuation Model 306
¦ Other Approaches to Valuing Common
Stocks 308
Comparing the Total Company and Dividend
Growth Models 308
9.8 Stock Market Equilibrium 310
Changes in Equilibrium Stock Prices 311
9.9 Investing in International Stocks 313
9.10 Preferred Stock 315
¦ Global Perspectives: Investing in Emerging
Markets 316
TYING IT ALL TOGETHER 316
xxvi Contents
INTEGRATED CASE
Mutual of Chicago Insurance Company 322
Part 4
Investing in Long Term Assets:
Capital Budgeting 327
The Cost of Capital 328
Creating Value at G£ 328
PUTTING THINGS IN PERSPECTIVE 329
10.1 An Overview of the Weighted Average Cost
of Capital 329
10.2 Basic Definitions 331
10.3 Cost of Debt, rd(l T) 332
10.4 Cost of Preferred Stock, rp 333
¦ Funny Named Preferred Like
Securities 334
10.5 Cost of Retained Earnings, rs 335
The CAPM Approach 336
Dividend Yield plus Growth Rate, or Discounted
Cash How (DCF), Approach 336
Bond Yield plus Risk Premium Approach 339
¦ How Much Does It Cost to Raise External
Capital? 340
10.6 Cost of New Common Stock, re 340
Add Flotation Costs to a Project s Cost 341
Increase the Cost of Capital 341
When Must External Equity Be Used? 342
10.7 Composite, or Weighted Average, Cost of
Capital, WACC 343
10.8 Factors That Affect the WACC 344
Factors the Firm Cannot Control 344
Factors the Firm Can Control 344
¦ Global Perspectives: Global Variations
in the Cost of Capital 345
10.9 Adjusting the Cost of Capital
for Risk 346
10.10 Some Other Problems with Cost of Capital
Estimates 348
TYING IT ALL TOGETHER 349
INTEGRATED CASE
Coleman Technologies Inc. 355
WEB APPENDIX 10A
The Cost of New Common Stock and the WACC
» r n
The Basics of Capital Budgeting 357
Competition in the Aircraft Industry 357
PUTTING THINGS IN PERSPECTIVE 358
11.1 Generating Ideas for Capital Projects 358
11.2 Project Classifications 359
11.3 The Net Present Value (NPV) Criterion 360
11.4 Internal Rate of Return (IRR) 363
11.5 Comparison of the NPV and IRR
Methods 364
NPV Profiles 364
NPV Rankings Depend on the Cost of Capital 365
Independent Projects 367
Mutually Exclusive Projects 367
11.6 Multiple IRRs 369
11.7 Modified Internal Rate of Return
(MIRR) 371
11.8 Payback Period 373
11.9 Conclusions on Capital Budgeting
Methods 375
11.10 Decision Criteria Used in Practice 376
11.11 Using Capital Budgeting Techniques in
Other Contexts 377
11.12 The Post Audit 378
TYING IT ALL TOGETHER 379
INTEGRATED CASE
Allied Components Company 385
Chapter 12
Cash Flow Estimation and Risk Analysis 387
Home Depot Keeps Growing 387
PUTTING THINGS IN PERSPECTIVE 388
12.1 Background on the Project 388
12.2 Project Analysis 390
Input Data, Part 1 390
Depreciation Schedule, Part 2 390
Salvage Value Calculations, Part 3 391
Projected Cash Flows, Part 4 392
Appraisal of the Proposed Project, Part 5 393
12.3 Other Points on Cash Flow Analysis 394
Cash Flow versus Accounting Income 394
Timing of Cash Flows 395
Incremental Cash Flows 395
Replacement Projects 395
Sunk Costs 395
Opportunity Costs 396
Externalities 396
12.4 Estimating Project Risk 397
12.5 Measuring Stand Alone Risk 398
Sensitivity Analysis 398
Scenario Analysis 400
Monte Carlo Simulation 401
¦ Global Perspectives: Capital Budgeting
Practices in the Asian/Pacific Region 402
12.6 Different Capital Structures 403
12.7 Incorporating Risk into Capital
Budgeting 403
TYING IT ALL TOGETHER 404
INTEGRATED CASE
Allied Food Products 409
APPENDIX 12A
Tax Depreciation 413
WEB APPENDIX 12B
Replacement Project Analysis
WEB APPENDIX 12C
Refunding Operations
WEB APPENDIX 12D
Using the CAPM to Estimate the Risk Adjusted Cost
of Capital
WEB APPENDIX 12E
Techniques for Measuring Beta Risk
Chapter 13
Real Options and Other Topics in
Capital Budgeting 415
Keeping Your Options Open 415
PUTTING THINGS IN PERSPECTIVE 416
13.1 Introduction to Real Options 416
13.2 Abandonment/Shutdown Options 417
13.3 Investment Timing Options 419
13.4 Growth Options 420
13.5 Flexibility Options 421
13.6 Comparing Mutually Exclusive Projects
with Unequal Lives 422
Replacement Chains 422
Equivalent Annual Annuities (EAA) 423
Conclusions about Unequal Lives 424
13.7 The Optimal Capital Budget 424
Contents xxvii
TYING IT ALL TOGETHER 426
INTEGRATED CASE
21st Century Educational Products 431
Part 5
Capital Structure and Dividend Policy 435
Capital Structure and Leverage 436
Debt: Rocket Booster or Anchor? 436
PUTTING THINGS IN PERSPECTIVE 437
14.1 The Target Capital Structure 437
14.2 Business and Financial Risk 439
Business Risk 439
Operating Leverage 441
Financial Risk 444
14.3 Determining the Optimal Capital
Structure 450
WACC and Capital Structure Changes 450
The Hamada Equation 452
The Optimal Capital Structure 453
14.4 Capital Structure Theory 456
¦ Yogi Berra on the M M Proposition 457
The Effect of Taxes 457
The Effect of Potential Bankruptcy 458
Trade Off Theory 459
Signaling Theory 460
Using Debt Financing to Constrain Managers 461
14.5 Checklist for Capital Structure Decisions 462
¦ Global Perspectives: Taking a Look at Global
Capital Structures 465
14.6 Variations in Capital Structures 465
TYING IT ALL TOGETHER 466
INTEGRATED CASE
Campus Deli Inc. 472
WEB APPENDIX 14A
Degree of Leverage
Distributions to Shareholders: Dividends
and Share Repurchases 478
Microsoft Shirts Gears and Begins to Unload Part of Its
Vast Cash Hoard 478
PUTTING THINGS IN PERSPECTIVE 479
xxviii Contents
15.1 Dividends versus Capital Gains: What Do
Investors Prefer? 479
Dividend Irrelevance Theory 480
Reasons Some Investors Prefer Dividends 480
Reasons Some Investors May Prefer Capital
Gains 481
15.2 Other Dividend Policy Issues 482
Information Content, or Signaling, Hypothesis 482
Clientele Effect 482
15.3 Establishing the Dividend Policy
in Practice 483
Setting the Target Payout Ratio: The Residual
Dividend Model 483
¦ Global Perspectives: Dividend Yields Around
the World 488
Earnings, Cash Hows, and Dividends 489
Payment Procedures 490
15.4 Dividend Reinvestment Plans 493
15.5 Summary of Factors Influencing Dividend
Policy 494
Constraints 494
Investment Opportunities 494
Alternative Sources of Capital 495
Effects of Dividend Policy on rs 495
15.6 Stock Dividends and Stock Splits 495
Stock Splits 496
Stock Dividends 496
Effect on Stock Prices 497
15.7 Stock Repurchases 498
The Effects of Stock Repurchases 498
¦ Stock Repurchases Soar in 2004 499
Advantages of Repurchases 500
Disadvantages of Repurchases 501
Conclusions on Stock Repurchases 501
TYING IT ALL TOGETHER 502
INTEGRATED CASE
Southeastern Steel Company 508
WEB APPENDIX 1 5A
An Example: The Residual Dividend Model
Part 6
Working Capital and Financial Planning 511
Working Capital Management 512
Best Buy Successfully Manages Its Working Capital 512
PUTTING THINGS IN PERSPECTIVE 512
16.1 Working Capital Terminology 513
16.2 The Cash Conversion Cycle 513
Calculating the Targeted CCC 514
Calculating the Actual CCC 515
¦ Some Firms Operate with Negative Working
Capital! 516
16.3 Alternative Current Asset Investment
Policies 517
16.4 Alternative Current Asset Financing
Policies 518
Maturity Matching, or Self Liquidating,
Approach 519
Aggressive Approach 519
Conservative Approach 519
Choosing between the Approaches 521
16.5 The Cash Budget 521
16.6 Cash and Marketable Securities 525
Currency 526
Demand Deposits 526
Marketable Securities 527
16.7 Inventories 528
¦ Supply Chain Management 529
16.8 Accounts Receivable 530
Credit Policy 530
Setting and Implementing the Credit Policy 531
Monitoring Accounts Receivable 532
16.9 Accounts Payable (Trade Credit) 534
16.10 Bank Loans 537
Promissory Note 537
Line of Credit 538
Revolving Credit Agreement 538
Costs of Bank Loans 539
16.11 Commercial Paper 541
16.12 Accruals (Accrued Liabilities) 542
16.13 Use of Security in Short Term Financing 542
TYING IT ALL TOGETHER 543
INTEGRATED CASE
Ski Equipment Inc. 548
WEB APPENDIX 16A
Inventory Management
WEB APPENDIX 16B
Short Term Loans and Bank Financing
¦, . . ¦..; •; ¦ ¦ ¦¦ 7
Financial Planning and Forecasting 552
Forecasting Apple s Future 552
PUTTING THINGS IN PERSPECTIVE 553
17.1 Strategic Planning 553
17.2 The Sales Forecast 555
17.3 The AFN Equation 556
Key Determinants of External Funds
Requirements 558
Excess Capacity Adjustments 558
17.4 Forecasted Financial Statements 560
Initial Forecast: Business as Usual 560
17.5 Using Regression to Improve Financial
Forecasts 563
17.6 Using Individual Ratios in the Forecasting
Process 565
Modifying Accounts Receivable 565
Modifying Inventories 566
Other Special Studies 566
TYING IT ALL TOGETHER 567
INTEGRATED CASE
New World Chemicals Inc. 572
WEB APPENDIX 17A
Forecasting Financial Requirements When Financial
Ratios Change
Part 7
Special Topics in Financial
Management 577
Derivatives and Risk Management 578
Using Derivatives to Manage Risk 578
PUTTING THINGS IN PERSPECTIVE 579
18.1 Reasons to Manage Risk 579
18.2 Background on Derivatives 582
¦ Global Perspectives: Barings and Sumitomo
Suffer Large Losses in the Derivatives
Market 583
18.3 Options 584
Option Types and Markets 584
Factors That Affect the Value of a
Call Option 586
Exercise Value versus Option Price 586
18.4 Introduction to Option Pricing Models 589
¦ Expensing Executive Stock Options 590
18.5 The Black Scholes Option Pricing Model
(OPM) 592
OPM Assumptions and Equations 592
OPM Illustration 594
Contents xxix
18.6 Forward and Futures Contracts 596
18.7 Other Types of Derivatives 600
Swaps 600
Structured Notes 601
Inverse Floaters 602
¦ Credit Instruments Create New
Opportunities and Risks 603
18.8 Risk Management 603
An Approach to Risk Management 605
¦ Microsoft s Goal: Manage Every Risk! 606
18.9 Using Derivatives to Reduce Risks 607
Security Price Exposure 607
Commodity Price Exposure 610
The Use and Misuse of Derivatives 610
TYING IT ALL TOGETHER 611
INTEGRATED CASE
Tropical Sweets Inc. 613
Multinational Financial Management 615
U.S. Firms Look Overseas to Enhance Shareholder
Value 615
PUTTING THINGS IN PERSPECTIVE 616
19.1 Multinational or Global Corporations 616
19.2 Multinational versus Domestic Financial
Management 619
19.3 The International Monetary System 621
International Monetary Terminology 621
Current Monetary Arrangements 622
19.4 Foreign Exchange Rate Quotations 623
Cross Rates 624
Interbank Foreign Currency Quotations 625
19.5 Trading in Foreign Exchange 626
Spot Rates and Forward Rates 626
19.6 Interest Rate Parity 627
19.7 Purchasing Power Parity 629
19.8 Inflation, Interest Rates, and Exchange
Rates 630
19.9 International Money and Capital
Markets 631
International Credit Markets 631
¦ Hungry for a Big Mac? Go to China! 632
¦ Stock Market Indices Around the World 634
International Stock Markets 635
19.10 International Capital Budgeting 636
xxx Contents
19.11 International Capital Structures 638
19.12 Multinational Working Capital
Management 639
Cash Management 639
Credit Management 640
Inventory Management 641
TYING IT ALL TOGETHER 642
INTEGRATED CASE
Citrus Products Inc. 646
Hybrid Financing: Preferred Stock, Leasing,
Warrants, and Convertibles 648
Taking a Wild Ride with Amazon s Convertible
Debt 648
PUTTING THINGS IN PERSPECTIVE 649
20.1 Preferred Stock 650
Basic Features 650
Other Types of Preferred Stock 652
Advantages and Disadvantages of Preferred
Stock 652
20.2 Leasing 653
Types of Leases 653
¦ Funny Named Preferred Like
Securities 654
Financial Statement Effects 656
Evaluation by the Lessee 657
Factors That Affect Leasing Decisions 660
20.3 Warrants 661
Initial Market Price of a Bond with
Warrants 662
Use of Warrants in Financing 663
Wealth Effects and Dilution Due to
Warrants 664
The Component Cost of Bonds with
Warrants 666
Problems with Warrant Issues 666
20.4 Convertibles 667
Conversion Ratio and Conversion Price 667
The Component Cost of Convertibles 668
Use of Convertibles in Financing 672
Convertibles and Conflicts of Interest 673
20.5 A Final Comparison of Warrants
and Convertibles 673
20.6 Reporting Earnings When Warrants
or Convertibles Are Outstanding 674
TYING IT ALL TOGETHER 675
INTEGRATED CASE
Fish Chips, Inc., Part I 681
Fish Chips, Inc., Part II 681
Mergers and Acquisitions 683
Procter Gamble Acquires Gillette 683
PUTTING THINGS IN PERSPECTIVE 684
21.1 Rationale for Mergers 685
Synergy 685
Tax Considerations 685
Purchase of Assets below Their Replacement
Cost 686
Diversification 686
Managers Personal Incentives 686
Breakup Value 687
21.2 Types of Mergers 687
21.3 Level of Merger Activity 687
21.4 Hostile versus Friendly Takeovers 689
21.5 Merger Regulation 690
21.6 Merger Analysis 691
Valuing the Target Firm 692
Setting the Bid Price 695
¦ More Than Just Financial Statements 697
Post Merger Control 698
21.7 Financial Reporting for Mergers 699
Purchase Accounting 699
Income Statement Effects 700
¦ Tempest in a Teapot? 701
21.8 The Role of Investment Bankers 702
Arranging Mergers 702
Developing Defensive Tactics 702
Establishing a Fair Value 703
Financing Mergers 703
Arbitrage Operations 704
21.9 Do Mergers Create Value? The Empirical
Evidence 704
¦ The Track Record of Recent Large
Mergers 705
21.10 Corporate Alliances 706
21.11 Leveraged Buyouts 706
21.12 Divestitures 707
Types of Divestitures 707
Divestiture Illustrations 707
¦ Global Perspectives: Governments Are
Divesting State Owned Businesses to Spur
Economic Efficiency 708
TYING IT ALL TOGETHER 710
INTEGRATED CASE
Smitty s Home Repair Company 713
WEB APPENDIX 21A
Holding Companies
Appendix A Solutions to Self Test
Questions and Problems A 1
Appendix B Answers to Selected End of
Chapter Problems A 27
Appendix C Selected Equations and
Data A 30
WEB APPENDIX C
Selected Equations and Data
1 1
Cyberproblem CP1 1 Executive Compensation
Cyberproblem CP2 1 Online Financial
Calculators
Cyberproblem CP3 1 Examining the Financial
Report—3M
Cyberproblem CP4 1 Using Ratio Analysis as
a Tool—Brady
Corporation
Cyberproblem CP5 1 World Financial Markets
Cyberproblem CP6 1 Yield Curves and
Interest Rates
Contents xxxi
Cyberproblem CP7 1 BondsOnline Educated
Investor Center
Cyberproblem CP8 1 Evaluating Portfolio
Risk and Return
Cyberproblem CP9 1 Intrinsic Stock
Valuation—Emerson
Electric
Cyberproblem CP10 1 Estimating the WACC—
AT T
Cyberproblem CP11 1 Capital Expenditures
and Investment—IBM
Cyberproblem CP12 1 Cash Flow Estimation—
Alcoa
Cyberproblem CP13 1 Real Options
Cyberproblem CP14 1 Applying the Hamada
Equation
Cyberproblem CP15 1 Dividend Reinvestment
Plans
Cyberproblem CP16 1 Cash Conversion
Cycle
Cyberproblem CP17 1 Using Analyst Reports
and Forecasts
Cyberproblem CP18 1 Option Strategies
Cyberproblem CP19 1 Multinational Financial
Management—
McDonald s
Cyberproblem CP20 1 Lease Analysis
Cyberproblem CP21 1 Mergers—
CNNMoney.com
Top 25 Deals of
the Year
|
| any_adam_object | 1 |
| author | Brigham, Eugene F. 1930- Houston, Joel F. Clark, Dana Aberwald |
| author_GND | (DE-588)124803059 |
| author_facet | Brigham, Eugene F. 1930- Houston, Joel F. Clark, Dana Aberwald |
| author_role | aut aut aut |
| author_sort | Brigham, Eugene F. 1930- |
| author_variant | e f b ef efb j f h jf jfh d a c da dac |
| building | Verbundindex |
| bvnumber | BV022377343 |
| classification_rvk | QP 700 |
| ctrlnum | (OCoLC)493490594 (DE-599)BVBBV022377343 |
| dewey-full | 658.15 |
| dewey-hundreds | 600 - Technology (Applied sciences) |
| dewey-ones | 658 - General management |
| dewey-raw | 658.15 |
| dewey-search | 658.15 |
| dewey-sort | 3658.15 |
| dewey-tens | 650 - Management and auxiliary services |
| discipline | Wirtschaftswissenschaften |
| edition | 11. ed. |
| format | Book |
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| id | DE-604.BV022377343 |
| illustrated | Illustrated |
| indexdate | 2024-12-20T12:54:04Z |
| institution | BVB |
| isbn | 032430269x |
| language | English |
| oai_aleph_id | oai:aleph.bib-bvb.de:BVB01-015586396 |
| oclc_num | 493490594 |
| open_access_boolean | |
| physical | IX, 462 S. graph. Darst. |
| publishDate | 2007 |
| publishDateSearch | 2007 |
| publishDateSort | 2007 |
| publisher | Thomson/South-Western |
| record_format | marc |
| spellingShingle | Brigham, Eugene F. 1930- Houston, Joel F. Clark, Dana Aberwald Study guide Fundamentals of financial management Entreprises - Finances - Problèmes et exercices ram Corporations Finance Problems, exercises, etc Finanzmanagement (DE-588)4139075-1 gnd |
| subject_GND | (DE-588)4139075-1 |
| title | Study guide Fundamentals of financial management |
| title_alt | Fundamentals of financial management |
| title_auth | Study guide Fundamentals of financial management |
| title_exact_search | Study guide Fundamentals of financial management |
| title_full | Study guide Fundamentals of financial management Eugene F. Brigham ; Joel F. Houston. Prepared by Dana Aberwald Clark |
| title_fullStr | Study guide Fundamentals of financial management Eugene F. Brigham ; Joel F. Houston. Prepared by Dana Aberwald Clark |
| title_full_unstemmed | Study guide Fundamentals of financial management Eugene F. Brigham ; Joel F. Houston. Prepared by Dana Aberwald Clark |
| title_short | Study guide Fundamentals of financial management |
| title_sort | study guide fundamentals of financial management |
| topic | Entreprises - Finances - Problèmes et exercices ram Corporations Finance Problems, exercises, etc Finanzmanagement (DE-588)4139075-1 gnd |
| topic_facet | Entreprises - Finances - Problèmes et exercices Corporations Finance Problems, exercises, etc Finanzmanagement |
| url | http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=015586396&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA |
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