Principals of Finance
BUSN350
Fall 2010; 1:30-2:20 MWF; HH344
Bruce A. Gratz email: bruce.gratz@blc.edu
Meyer Hall 308 mobile phone:(507)380-1617
COURSE OVERVIEW
This course is intended as a study of financial principals and theories concerning the acquisition, control and allocation of financial resources in business organizations.
Objectives:
1. To understand the concepts of financial institutions and markets, interest rates and fundamentals of business taxation.
2. To understand the basic components of the stockholders’ report.
3. To understand the effect of depreciation and the ability to develop and interpret the statement of cash flows.
4. To be able to construct and interpret a financial ratio analysis.
5. To understand the time value of money. (future value and present value)
6. To be able to understand the meaning and fundamentals of risk, return and risk preferences.
7. To be able to apply the basic valuation models to bonds and stocks.
8. To be able to understand and construct capital budgeting and cash flow statements.
9. To be able to understand and calculate the cost of capital.
10. To be able to understand and apply how leverage affects the capital structure.
11. To be able to understand the concept of long-term debt and investment banking.
12. To be able to understand how common stock and its dividend policy, preferred stock, leasing, convertibles, warrants and options affects the capital structure.
13. To be able to understand the financial planning and budgeting process.
14. To be able to understand the concepts of working capital and short-term financing.
15. to be able to understand the convepts of cash, marketable securities, accounts receivable and inventory and how it affects the financial picture of a corporation.
Course Outline:
See Attachment A.
LEARNING RESOURCES
Text:
Brealey, Myers, Marcus (2009). Fundamentals of Corporate Finance (6th ed.). McGraw Hill/Irwin.
Reserve Readings:
Additional reserve readings may supplement the text.
LEARNING DEMONSTRATIONS
Learning will be demonstrated in this course through exams, homework exercises, and in-class discussion.
1) Exams will be given at the end of each unit, and at the conclusion of the course.
2) Homework exercises will be given periodically to apply chapter material. These will be randomly collected and graded.
3) Discussion of material will be based on your preparedness and your ability to summarize, compare, and contrast viewpoints during class discussion. You will be given assignments to prepare for class to be used as a basis for discussion. If it appears that preparation is inadequate, this instructor reserves the right to begin quizzes.
GRADING
Grading Points
Unit Exams and Final Exam 80%
Random Quizzes and Homework 20%
Grading Scale
Grade Percentage
A = 93.4% to 100.0%
A- = 90.0% to 93.3%
B+ = 86.7% to 89.9%
B = 83.4% to 86.6%
B- = 80.0% to 83.3%
C+ = 76.7% to 79.9%
C = 73.4% to 76.6%
C- = 70.0% to 73.3%
D+ = 66.7% to 69.9%
D = 63.4% to 66.6%
D- = 60.0% to 63.3%
F = 00.0% to 59.9%
Attendance Policy
It is your responsibility to notify me of your absence prior to the class meeting you will miss, preferably by email. It is also your responsibility to make up any missed work. After excessive unexcused absences, the instructor reserves the right to lower your grade or drop you from the course. Excused absences will include any scheduled college activity for which you must attend: sports, fine arts, class trips, or other special campus events. However, excused absences must still be reported prior to the class meeting. All other absences are considered unexcused. Please do not hesitate to talk with me about any other circumstances. Communication will make the difference to acceptable standards.