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Fin 370 Week 1 Definitions

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Define the following terms using your text or other resources. Cite all resources consistent with APA guidelines.

|Term |Definition |Resource you used |
|Time value of money |“A dollar received today is worth more than a|Titman, S. Keown, A. J. & . Martin ,J. D. (n.d.). |
| |dollar received in the future. Conversely, |Financial Management. Principles and Applications: |
| |a dollar received in the future is worth less|Chapter 1: Getting Started: Principles of Finance: 1.4. |
| |than a dollar received today. Perhaps the |The Five Basic Principles of Finance. 12th,. ed. |
| |most fundamental principle of finance is that|Copyrighted by Pearson Education. (2014). Retrieved from|
| |money has a time value. A dollar received ||
| |today is more valuable than a dollar received|OSIRIS:48546409/context/co/view/activityDetails/activity|
| |one year from now. That is, we can invest the|/3195cb75-8a75-4bd9-a1c3-0092ba334301/expanded/False |
| |dollar we have today to earn interest so that| |
| |at the end of one year we will have more than| |
| |one dollar.” (Titman et al.) | |
|Efficient market | “An investment theory that states it is |Investopedia. (n.d.). Efficient Market Hypothesis – EMH.|
| |impossible to "beat the market" because stock|Copyrighted by Investopedia, LLC. (2014). Retrieved from|
| |market efficiency causes existing share ||
| |prices to always incorporate and reflect all |hesis.asp |
| |relevant information. According to the EMH, | |
| |stocks always trade at their fair value on | |
| |stock exchanges, making it impossible for | |
| |investors to either purchase undervalued | |
| |stocks or sell stocks for inflated prices. As| |
| |such, it should be impossible to outperform | |
| |the overall market through expert stock | |
| |selection or market timing, and that the only| |
| |way an investor can possibly obtain higher | |
| |returns is by purchasing riskier | |
| |investments.” (Investopedia) | |
|Primary versus secondary market | “A primary market is a market in which new, | Titman, S. Keown, A. J. & . Martin ,J. D. (n.d.). |
| |as opposed to previously issued, securities |Financial Management. Principles and Applications: |
| |are bought and sold for the first time. In |Chapter 2: Firms and the Financial Market: 2.3. The |
| |this market, firms issue new securities to |Financial Marketplace: Securities Markets. 12th., ed. |
| |raise money that they can then use to help |Copyrighted by Pearson Education. (2014). Retrieved from|
| |finance their businesses. The key feature of ||
| |the primary market is that the firms selling |OSIRIS:48546409/context/co/view/activityDetails/activity|
| |securities actually receive the money raised.|/adfd688a-a88b-428b-ade6-3fddc4106cce/expanded/False |
| |The secondary market is where all subsequent | |
| |trading of previously issued securities takes| |
| |place. In this market the issuing firm does | |
| |not receive any new financing, as the | |
| |securities it has sold are simply being | |
| |transferred from one investor to another. The| |
| |principal benefit of the secondary market for| |
| |the shareholders of firms that sell their | |
| |securities to the public is liquidity.” | |
| |(Titman et al.) | |
|Risk-return tradeoff | “We won’t take on additional risk unless we |Titman, S. Keown, A. J. & . Martin ,J. D. (n.d.). |
| |expect to be compensated with additional |Financial Management. Principles and Applications: |
| |return. Principle 2 is based on the idea that|Chapter 1: Getting Started: Principles of Finance: 1.4. |
| |individuals are risk-averse, which means that|The Five Basic Principles of Finance. 12th,. ed. |
| |they prefer to get a certain return on their |Copyrighted by Pearson Education. (2014). Retrieved from|
| |investment rather than an uncertain return.” ||
| |(Titman et al.) |OSIRIS:48546409/context/co/view/activityDetails/activity|
| | |/3195cb75-8a75-4bd9-a1c3-0092ba334301/expanded/False |
| | | |
|Agency (principal and agent problems) |“Conflicts of interest and moral hazard |Investopedia. (n.d.). Efficient Market Hypothesis – EMH.|
| |issues that arise when a principal hires an |Copyrighted by Investopedia, LLC. (2014). Retrieved from|
| |agent to perform specific duties that are in ||
| |the best interest of the principal but may be|lem.asp |
| |costly, or not in the best interests of the | |
| |agent. The principal-agent problem develops |Titman, S. Keown, A. J. & . Martin ,J. D. (n.d.). |
| |when a principal creates an environment in |Financial Management. Principles and Applications: |
| |which an agent has incentives to align its |Chapter 1: Getting Started: Principles of Finance: 1.4. |
| |interests with those of the principal, |The Five Basic Principles of Finance. 12th,. ed. |
| |typically through incentives. Principals |Copyrighted by Pearson Education. (2014). Retrieved from|
| |create incentives for the agent to act as the||
| |principal wants because the principal faces |OSIRIS:48546409/context/co/view/activityDetails/activity|
| |information asymmetry and risk with regards |/3195cb75-8a75-4bd9-a1c3-0092ba334301/expanded/False |
| |to whether the agent has effectively | |
| |completed a contract.” (Investopedia) | |
| |“The conflict of interest between the firm’s | |
| |managers and its stockholders is called a | |
| |principal-agent problem, or agency problem, | |
| |in which the firm’s common stockholders, the | |
| |owners of the firm, are the principals in the| |
| |relationship, and the managers act as | |
| |“agents” to these owners. The lost | |
| |shareholder value that results from | |
| |managerial actions that are inconsistent with| |
| |the goal of maximizing shareholder value is | |
| |called an agency cost.” (Titman et a;.) | |
|Market information and security prices|“Market information is what influences |Octotutor. (2014). Market Information and Security |
|and information asymmetry |investors to either buy or sell stock. If |Prices and Information Asymmetry. Copyrighted by |
| |investors receive positive information, there| (2014). Retrieved form |
| |will be more buying demand for the stock, ||
| |thus raising the price. If negative |ces-and-information-asymmetry/ |
| |information is received, investors will sell | |
| |shares and drive prices down. Common sources | |
| |of information come in the form of public | |
| |financial reports and news related to a | |
| |company’s industry or business. Public | |
| |companies must release quarterly and annual | |
| |reports, which investors use to predict | |
| |future financial reports. These reports will | |
| |have a direct impact on securities prices in | |
| |the market. In some cases, news reports can | |
| |impact expected business performance. Because| |
| |our markets are not perfectly efficient, it | |
| |takes time for information to flow through | |
| |the system. The average individual investor | |
| |will receive information about a stock long | |
| |after it has already influenced the share | |
| |process. Algorithms that track news trends | |
| |and make trading decisions based on this | |
| |information contribute to the so called | |
| |information asymmetry we experience in the | |
| |financial markets.” (Octotutor, 2014) | |
|Agile and lean principles |“The lean principles of operational | Sabri, E. CFPIM. LSSMBB. & Shaikh, S. CPIM. CSCP. |
| |excellence, efficiency, and eliminating waste|(2013). Lean and Agile. Copyrighted by APICS. (2013). |
| |are essential to successful S&OP—as is |Retrieved from |
| |agility, which puts emphasis on planning and ||
| |controlling variability. Lean and agile S&OP |/publications/apics-magazine-home/apics-magazine---landi|
| |is a company’s single-most-important |ng-page---everyone/2013/09/20/lean-and-agile |
| |competitive weapon for ensuring that | |
| |customers are being profitably served through| |
| |the right channels and with the right product| |
| |mix. Only when S&OP is truly lean and agile | |
| |can the process help companies recalibrate | |
| |business strategy through continuous | |
| |replanning. Lean and agile S&OP involves | |
| |stakeholders from sales, marketing, | |
| |development, operations, sourcing, and | |
| |finance coming together in a formal, | |
| |structured cadence to produce an integrated | |
| |company game plan. This approach reconciles | |
| |the views of all functional areas | |
| |simultaneously, making sure the strategy | |
| |aligns with strategic business objectives. | |
| |Principles The following principles are | |
| |fundamental to lean and agile S&OP: Focus on | |
| |customer success. Make sure all participants | |
| |share the same goals and are linked to the | |
| |end customer. Create a mutually advantageous | |
| |and trusted environment for all stakeholders.| |
| |S&OP is a cross-functional process, so | |
| |organizations must look beyond local | |
| |departmental efficiencies and performance | |
| |metrics and instead focus on a performance | |
| |measurement system that creates benefits for | |
| |all stakeholders and aligns to the business | |
| |plan. Eliminate waste and reduce non-value | |
| |added activities. This principle encourages | |
| |firms to free resources to enable greater | |
| |focus process rather than a reporting | |
| |exercise. | |
| |Institutionalize continuous improvement. A | |
| |formalized, structured S&OP process that | |
| |rewards continuous improvement should be | |
| |institutionalized so that it becomes a part | |
| |of the company culture. Close the loop | |
| |between planning and execution. This | |
| |principle emphasizes a “one number" plan to | |
| |which the whole organization is aligned. This| |
| |is made possible through vertical integration| |
| |among strategic, tactical, and operational | |
| |planning. In addition, using agility to | |
| |mitigate risk via scenario analysis enables | |
| |businesses to become more flexible and | |
| |responsive.” (Sabri et al, 2013) | |
|Return on investment |“A profitability measure that evaluates the |Entrepreneur. (n.d). Return On Investment ROI. |
| |performance of a business by dividing net |Copyrighted by Entrepreneur Media, Inc. (2014). |
| |profit by net worth. Return on investment |Retrieved from |
| |isn't necessarily the same as profit. ROI ||
| |deals with the money you invest in the |tment-roi |
| |company and the return you realize on that | |
| |money based on the net profit of the | |
| |business. Profit, on the other hand, measures| |
| |the performance of the business. You can use | |
| |ROI in several different ways to gauge the | |
| |profitability of your business. For instance,| |
| |you can measure the performance of your | |
| |pricing policies, inventory investment, | |
| |capital equipment investment, and so forth. | |
| |Some other ways to use ROI within your | |
| |company are by: | |
| |Dividing net income, interest, and taxes by | |
| |total liabilities to measure rate of earnings| |
| |of total capital employed. | |
| |Dividing net income and income taxes by | |
| |proprietary equity and fixed liabilities to | |
| |produce a rate of earnings on invested | |
| |capital. | |
| |Dividing net income by total capital plus | |
| |reserves to calculate the rate of earnings on| |
| |proprietary equity and stock equity.” | |
| |(Entrepreneur) | |
|Cash flow and a source of value | “Profit is an accounting concept designed to|Titman, S. Keown, A. J. & . Martin ,J. D. (n.d.). |
| |measure a business’s performance over an |Financial Management. Principles and Applications: |
| |interval of time. Cash flow is the amount of |Chapter 1: Getting Started: Principles of Finance: 1.4. |
| |cash that can actually be taken out of the |The Five Basic Principles of Finance. 12th,. ed. |
| |business over this same interval. Cash flows |Copyrighted by Pearson Education. (2014). Retrieved from|
| |represent actual money that can be spent and,||
| |cash flows are what determine an investment’s|OSIRIS:48546409/context/co/view/activityDetails/activity|
| |value.” (Titman et al.) |/3195cb75-8a75-4bd9-a1c3-0092ba334301/expanded/False |
|Project management |“The planning and organization of an |Investopedia. (n.d.). Project Management. Copyrighted by|
| |organization's resources in order to move a |Investopedia, LLC. (2015). Retrieved from |
| |specific task, event or duty toward ||
| |completion. Project management typically |sp |
| |involves a one-time project rather than an | |
| |ongoing activity, and resources managed | |
| |include both human and financial capital. A | |
| |project manager will help define the goals | |
| |and objectives of the project, determine when| |
| |the various project components are to be | |
| |completed and by whom, and create quality | |
| |control checks to ensure that completed | |
| |components meet a certain standard.” | |
| |(Investopedia) | |
|Outsourcing and offshoring |“Outsourcing refers to an organization |Diffin. (n.d.). Offshoring vs. Outshourcing. Retrieved |
| |contracting work out to a 3rd party, while |from |
| |offshoring refers to getting work done in a ||
| |different country, usually to leverage cost |ng |
| |advantages. It's possible to outsource work | |
| |but not offshore it; for example, hiring an | |
| |outside law firm to review contracts instead | |
| |of maintaining an in-house staff of lawyers. | |
| |It is also possible to offshore work but not | |
| |outsource it; for example, a Dell customer | |
| |service center in India to serve American | |
| |clients. Offshore outsourcing is the practice| |
| |of hiring a vendor to do the work offshore, | |
| |usually to lower costs and take advantage of | |
| |the vendor's expertise, economies of scale, | |
| |and large and scalable labor pool.” (Diffin) | |
|Inventory turnover |“Inventory turnover may be defined as annual | Mayo, H. B. (n.d.). Basic Finance. An Introduction to |
| |sales divided by average inventory.” (Mayo) |Financial Institutions, Investments, and Management: |
| | |Chapter 9: Analysis of Financial Statements: Activity |
| |“A ratio showing how many times a company's |Ratios. Copyrighted by Cengage Learning. (2010). |
| |inventory is sold and replaced over a period.|Retrieved from |
| |The days in the period can then be divided by||
| |the inventory turnover formula to calculate |OSIRIS:48546409/context/co/view/activityDetails/activity|
| |the days it takes to sell the inventory on |/4612e916-7bfa-4e82-aa0d-88545fe0e8bd/expanded/False |
| |hand or "inventory turnover days." | |
| |(Investopedia) |Investopedia. (n.d.). Inventory Turnover. Copyrighted by|
| | |Investopedia, LLC. (2015). Retrieved from |
| | ||
| | |p |
|Just-in-time inventory (JIT) |“Just in time (JIT) inventory is a management|Kokemuller, N & Demand Media. (n.d.). Just in Time |
| |system in which materials or products are |Inventory Definition. Copyrighted by Hearst Newspapers, |
| |produced or acquired only as demand requires.|LLC. (2015). Retrieved from |
| |Just in time inventory is intended to avoid ||
| |situations in which inventory exceeds demand |ition-23475.html |
| |and places increased burden on your business | |
| |to manage the extra inventory. Manufacturers | |
| |using JIT processes want to use materials for| |
| |production at levels that meet distributor or| |
| |retailer demand but not in excess. Retailers | |
| |only want to acquire and carry inventory that| |
| |meets immediate customer demand. Excess | |
| |inventory requires storage and management | |
| |costs.” (Kokemuller, Demand Media) | |
|Vender managed inventory (VMI) |“Vendor-managed inventory (VMI) is an |Rouse, M. (n.d.) vender-managed inventory (VMI). |
| |inventory management technique in which a |Copyrighted by Tech Target. (2008-2015). Retrieved from |
| |supplier of goods, usually the manufacturer, ||
| |is responsible for optimizing the inventory |Vendor-managed-inventory-VMI |
| |held by a distributor. VMI requires a | |
| |communication link—typically electronic data | |
| |interchange (EDI) or the Internet—that | |
| |provides the supplier with the distributor | |
| |sales and inventory data it needs to plan | |
| |inventory and place orders. In contrast, | |
| |under the traditional arrangement the | |
| |distributor handles those tasks. The | |
| |inventory can be owned by the distributor, or| |
| |by the supplier, often under consignment.” | |
| |(Rouse) | |
|Forecasting and demand management |“Demand management and forecasting is |APICS. (n.d.). APICS Operations Management Body of |
| |recognizing all demand for goods and services|Knowledge Framework, Third Edition. Copyrighted by |
| |to support the marketplace. Demand is |APICS. (2015). Retrieved from |
| |prioritized when supply is lacking. Proper ||
| |demand management facilitates the planning |ons/ombok/apics-ombok-framework-table-of-contents/apics-|
| |and use of resources for positive and |ombok-framework-5.4 |
| |profitable results and may involve marketing | |
| |programs designed to increase or reduce | |
| |demand in a relatively short time. | |
| |Forecasting is attempting to predict or | |
| |project future statistics—typically, demand | |
| |or sales. It requires that all factors | |
| |surrounding the decision-making process are | |
| |recorded.” (APICS) | |

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...FIN 571 WEEK 1 A+ Graded Tutorial Available At: Visit Our website: Product Description PRODUCT DESCRIPTION FIN 571 Week 1 In advising, what type of business structure to partake on, one has many options to consider when deciding to start a new business venture. The business structures that has to be identified and determined which is suitable for the individual or individuals are the Sole Proprietorship, Partnership and the Corporate structure and also the Sub Chapter S Corp and the Limited Liability business structure. Each of these structures have particular advantages and disadvantages that are associated with them, that needs to be addressed and identified The Sole Proprietorship structure is an individually owned and managed. This business structure is the least regulated out of the different structures and the costly to form. The owner of this business structure has complete control and has a simplified tax structure to adhere to. A major disadvantage of the Sole proprietorship business structure is that income is reported as individual income .Also another disadvantage with Sole proprietorship business structures are that the owners amount of personal liability for the business, and that banks are more reluctant in providing loans for this type of business structure because of a perception that the business will have the ability to repay the loan if the business fails. Because of......

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Fin 370 Week 3 Assignment Precision Machines Part 1

...FIN 370 Week 3 Assignment Precision Machines Part 1 Click Link Below To Buy: Click Link Below To Buy: Precision Machines is preparing a financial plan for the next six months to determine the financial needs of the company. The historical analysis of the company’s sales shows that the company’s total sales are 30% cash sales and 70% credit sales. Further analysis of credit sales shows that the company receives 50% of the credit sales one month after the sale and the remaining 50% in the second month after the sale. This means the cash collections from sales are 30% in the first month of the sale, 35% in the second month, and 35% in the third month. The materials purchased by the company amounts to 50% of the sales for the month. The company pays for the purchases one month after the initial purchase. The company likes to maintain a cash balance of $5,000. The cost of borrowing is 10%. The company plans to pay off the loan whenever there is a surplus and borrow when there is a deficit. The attached spreadsheet shows revenues (sales), expenses, capital expenditures, and other expenses for Precision Machines’ next six months. Using the information given on the spreadsheet, prepare a cash budget for January through June and determine the cash surplus, deficit, and the financing needs of the company. Review the Learning Team Assignment due in Week 5. Create an outline...

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Fin 370 Week 4 Cash Flow Analysis approval? • Analyze whether the investment in the truck is profitable. • Explain whether it is more beneficial for Frank to close his business. • Explain what you would do in this same situation. Format your assignment consistent with APA guidelines. Click the Assignment Files tab to submit your assignments. Supporting Material: Frank Smith Plumbing Case Study Frank Smith Plumbing Case Study Excel Spreadsheet Cash Flow Analysis Grading Guide Find The Complete Answers just a click away FIN 370 Complete Answer About Author This article covers the topic for the University Of Phoenix FIN 370 Week 4 Cash Flow Analysis the author is working in the field of education from last 5 years. This article covers the basic of FIN 370 Complete Answer from UOP. Other topics in the class are as follows: FIN 370 WEEK 4 CASH FLOW ANALYSIS FIN 370 FINAL EXAM (NEWEST) FIN 370 WEEK 1 COMPLETE FIN 370 WEEK 2 COMPLETE FIN 370 WEEK 3 COMPLETE FIN 370 WEEK 4 COMPLETE FIN 370 WEEK 5 COMPLETE Want to check other classes..?? Visit

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...Howard Parsons July 17, 2012 Financial Terms and Roles 1. Finance – The management of money by governments and companies. The only role the word finance has in finance is the word itself. It is the definition of what exactly finance is. 2. Efficient Market – A market where all pertinent information is available to all participants at the same time. An efficient market allows for businesses and investors to make the best investment decisions possible based off of current information. 3. Primary Market – The market where companies initially sell stocks that they have been authorized to sell. The primary market allows firms to raise available capital by going public and selling initial stocks. 4. Secondary Market – The market where investors sell and trade previously issued stock. The secondary market allows investors to buy, sell, and trade previously issued stock in the hope of earning money for them. The gain or loss is not absorbed by the company that issued the stock but rather the person who initially purchased the stock. 5. Risk – The chance that the actual return on an investment will be less than what was the projected return. Taking on risky investments that have a higher projected return can lure in investors. The projected returns are higher because the risk of failure, or loss of money, has a higher possibility. 6. Security – An instrument that is issued to show ownership. Common securities are bonds, notes, and stock shares. Securities are used by......

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Fin 370 Week 1 Terms

...Create a list of definitions of the following terms and identify their roles in finance: Finance: This is the study of how people and businesses evaluate investments and raise capital to fund them. It is also considered to be the science of the management of money and other assets. One example would be family personal finances, taking what is being made versus what is being spent, and evaluating that to purchase vehicles, homes or other family needs. Efficient market: This is a market whose prices quickly respond to the announcement of new information. One example would be the iphone. As soon as the new iphone 5 was released today, the iphone 4s is now on discount. Another great example would be the stock market, as these change drastically and often based on new announcements. Primary market: This is a part of the financial market where new security issues are initially bought and sold. One great example would be Companies, governments or public sector institutions that funding through the direct purchase of a new stock or bond. Secondary market: This is a financial market where previously issued securities such as stocks and bonds are bought and sold. A great example of this would be after the bank is issued stocks and bonds, they are then sold to consumers and customers at the bank. Risk: Risk is a possibility for investments. Shareholders, investors, business owners all have a certain amount of risk. Risk is the possibility you'll lose money if an investment you......

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