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FIN220 1 st Midterm Review. Dr. Bader Alhashel. Ch 1 An Overview of Financial Management. What is Finance? Finance vs Economics & Accounting Finance within an Organization Corporate Finance, Capital Markets, & Investments Forms of Business Organization
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FIN220 1st Midterm Review Dr. Bader Alhashel
Ch 1 An Overview of Financial Management • What is Finance? • Finance vs Economics & Accounting • Finance within an Organization • Corporate Finance, Capital Markets, & Investments • Forms of Business Organization • Corporation (Advantages vs Disadvantages) • Limited Liability
Ch 1 An Overview of Financial Management • Stock Price & Shareholder Value • Shareholder Wealth Maximization • Intrinsic Value, Stock Price, & Executive Compensation • Intrinsic Value • Stock Price • Equilibrium
Ch 1 An Overview of Financial Management • Conflicts Between Managers, Stockholders, & Bondholders • Managers vs Shareholders • Stockholder vs Bondholder
Ch 2 Financial Markets & Institutions • The Capital Allocation Process • Financial Markets • Types of Markets • Derivatives • Financial Institutions • The Stock Market
Ch 2 Financial Markets & Institutions • The Market for Common Stock • Types of Stock Market Transactions • IPOs • Stock Market Returns • Stock Market Efficiency • Behavioral Finance
Ch 4 Analysis of Financial Statements • Ratio Analysis • Liquidity Ratios • Current Ratio • Quick Ratio • Asset Management Ratio • Inventory Turnover Ratio • Days Sales Outstanding (DSO) • Fixed Asset Turnover Ratio • Total Assets Turnover Ratio
Ch 4 Analysis of Financial Statements • Debt Management Ratio • Effect of Debt (Leverage) on ROE • Total Debt to Total Assets • Times-Interest-Earned Ratio (TIE) • Profitability Ratios • Operating Margin • Profit Margin • ROA • BEP Ratio • ROE
Ch 4 Analysis of Financial Statements • Market Value Ratios • Price/Earnings Ratio (P/E) • Market/Book Ratio (M/B) • Trend Analysis • The DuPont Equation • Benchmarking • Uses & Limitations of Ratios • Potential Misuses of ROE • Looking Beyond the Numbers