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Finance 331

FINC 331
Introduction to Business Finance

1. Catalog Entry

FINC 331
Introduction to Business Finance

Prerequisite: STAT 200
Co- or Prerequisite: ACTG 212

Credit hours (3)

Introduces financial concepts and techniques of financial management and emphasizes an understanding of how the principles of finance can be used to enhance the value of the firm.  Topics include the mathematics of interest and the time value of money, financial statement analysis and forecasting, valuation techniques, the measurement and relationship between risk and expected return, capital investment decisions, and working capital management.

2. Detailed Description of Course

    1) Overview of Corporate Finance
        a. Introduction to Corporate Finance
        b. Financial Statements and Taxes
    2) Financial Statements and Cash Flow Analysis
        a. Working with Financial Statements
        b. Operating Cash Flow and Free Cash Flow
    3) Time Value of Money
        a. Present Value and Future Value
        b. Annuities and unequal Periodic Cash Flows
        c. Compounding Interest Rates
        d. Loan Amortization
    4) Risk and Return
        a. Calculating Returns
        b. Stand Alone Risk and Portfolio Risk
        c. Diversification
        d. Capital Asset Pricing Model
    5) Work Interest Rates and Bind Valuation
        a. Interest Rates and Term Structures of Interest Rates
        b. Legal Aspects of Bonds
        c. Bond Yields
        d. Bond Valuations
    6) Stocks and their Valuation
        a. Legal Aspects of Stocks
           b. Common Stock versus Preferred Stock
        c. Issuing Common Stock
        d. Common Stock Valuation
    7) Capital Budgeting
        a. Net Present Value and Other Investment Criteria
        b. Making Capital Investment Decisions
    8) The Cost of Capital
    9) Principles of Working Capital Management

3. Detailed Description of Conduct of Course

Primarily a course lecture/discussion where instruction includes demonstration, in-class exercises, problem assignments and periodic exams.  Instruction is augmented by outside readings and projects that deal with financial statement analysis as deemed necessary by the instructor.  

4. Goals and Objectives of the Course

Having successfully completed the course, the student will be able to:
    1) Explain why financial management is important,
    2) Discuss the financial system, interest rates, and taxes
    3) Analyze financial statements
    4) Discuss and use the formula for the time value of money
    5) Use bond and stock valuation techniques
    6) Explain the relationship between risk and return
    7) Calculate the weighted average cost of capital (WACC)
    8) Relate to issues of corporate social responsibilities

5. Assessment Measures

Graded assignments may include in-class tests, a final examination, online homework, pop quizzes, the assignment and the presentation of problem exercises, projects and class preparation and participation.

6. Other Course Information

None

Review and Approval
May 2013
September 2, 2014