...1. 2. 3. 4. 5. 6. 7. 8. 9. Accounting Identity Time Value of Money Risk vs Reward Diversification Leverage Cash vs Accrual Cash & Free Cash Flow Sunk Costs Opportunity Costs A. B. C. D. E. F. G. H. I. J. K. Agency Conflicts Capital Structure Cost of Capital - WACC Market Efficiency Arbitrage – No Free Lunch NPV vs IRR Relevant Costs CAPM Hedging Inflation Taxes Financing Growth and Expansion 1. Assets = Liabilities All resources are owed to someone: they belong to someone. 2. Assets = Owner’s equity + (Outsiders’) Liabilities We separate the liabilities because outsiders’ claims have to be settled first. Owner’s get the residual value. If assets increase (owing to operations), owners’ equity increases. If assets fall in value, owners’ equity falls. 3. Assets = Owner’s Equity + LT Liability + ST Liability We separate the liabilities to know what we have to pay for immediately, as opposed to that for which we are not pressed. We can keep on breaking it up till the cost of maintaining and presenting further bifurcations is more than the benefit. 4. Current Assets + Fixed Assets = Owners’ Equity + LT Liability + ST Liability The detail of the assets shows which assets can be liquidated fairly fast (useful in order to pay off liabilities). No matter which side of the equation we take, it reflects the position (stock) at a point in time. Financing Growth and Expansion 5. Current Assets + Fixed Assets = Owners’ Equity + LT Liability...
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...Accounting | O’Henry’s data services | Accounting | | Lorine Reed | 10/17/2010 | [Type the abstract of the document here. The abstract is typically a short summary of the contents of the document. Type the abstract of the document here. The abstract is typically a short summary of the contents of the document.] | The trail balance unreported expenses is $2,750 and the revenue is $2,100 ,So the revenue for November was $14,300plus $2,100 which equals $16,400. Expense $3,400 and $900 plus the unreported $2750.00 the total amount is $7,050. $16,400 minus $7050 equals $9350 times 12 equals $112,200. To pay 20 times that amount is $187,000.I added $2,100 revenue and $2,750 expense. Benjamin O Henry’s revenue is $16,400 and the total expense are $7050.00. When I subtracted the expense of $7050 from the revenue $16,400 the net income was $9350.If I were to purchase Benjamin O Henry’s business the amounts of revenue would stay the same. My expenses would be a additional $3000.00 for managers salary. My total expenses would be $10,050. When subtracting my expenses from my revenue my net income would be $16,400. The most I will pay for the business is 20 times the monthly net income.20 times $6350 which equals $127,000. Benjamin O Henry will take no least than his ending capital of $144,750. There is a $17,750 difference than what I would offer. I would talk to Mr. Henry to see if we could work something out or ask him if he would be willing to lower the sales price...
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...KEY CONCEPTS OF FINANCE A QUALITY E-LEARNING PROGRAM BY WWW.LEARNWITHFLIP.COM ©Finitiatives Learning India Pvt. Ltd. (FLIP), 2010. Proprietary content. Please do not misuse! Accounting All businesses have financial transactions all the time. These are recorded in a particular way. Businesses can be structured in 3 ways: 1. Proprietorship: business with a single owner. Owner has complete liability for all debts of the company. 2. Partnership: business with 2 to 10 equal owners. All partners share complete liability for all debts of the company. 3. Limited company: Many owners with limited liability for debts of the business; this liability is only up to their capital contributed. There are t two types of limited companies: private and public. The former is held by 2-50 owners privately. The latter has unlimited number of owners, and any member of the public can be a part-owner. A business has numerous transactions which need to be recorded following certain accounting principles and process. Accounting Principles These are called Generally Accepted Accounting Principles, or GAAP. Key GAAPs are 1. Going Concern Concept: This principle assumes that a business will go on, that is, it will continue in the foreseeable future – it has no finite life. We use this principle to project cash flows in the future. 2. Legal Entity: The business is an entity separate from owners; even if it’s a small, one person business running out of home. Therefore the business accounts...
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...CHAPTER 7 Stocks, Stock Valuation, and Stock Market Equilibrium 1 Topics in Chapter Features of common stock Valuing common stock Preferred stock Stock market equilibrium Efficient markets hypothesis Implications of market efficiency for financial decisions 2 The Big Picture: The Intrinsic Value of Common Stock Free cash flow (FCF) Dividends (Dt) D2 D1 D∞ + + ... + (1 + rs )1 (1 + rs)2 (1 + rs)∞ ValueStock = Market interest rates Market risk aversion Cost of equity (rs) Firm’s debt/equity mix Firm’s business risk Common Stock: Owners, Directors, and Managers Represents ownership. Ownership implies control. Stockholders elect directors. Directors hire management. Since managers are “agents” of shareholders, their goal should be: Maximize stock price. 4 Classified Stock Classified stock has special provisions. Could classify existing stock as founders’ shares, with voting rights but dividend restrictions. New shares might be called “Class A” shares, with voting restrictions but full dividend rights. 5 Tracking Stock The dividends of tracking stock are tied to a particular division, rather than the company as a whole. Investors can separately value the divisions. Its easier to compensate division managers with the tracking stock. But tracking stock usually has no voting rights, and the financial disclosure for the division is not as regulated as for the company. 6 Different...
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...enhanced disclosures on amount, timing and uncertainty of future cash flows from insurance contracts.” Phase 2 will be the issuance of a new Insurance Contracts Standard, which will actually replace IFRS 4 (Insurance Contracts). Leases The Leases project deals with the reporting of lease information to investors and analysts. The main goal of the project is to develop a new standard that will establish the guidance for entities to follow on reporting information regarding the amount, timing and uncertainty of cash flows arising from a lease. As stated in the work plan, in order to reach that goal, “a lessee should recognize assets and liabilities from a lease.” Because leasing allows entities to gain access to assets or additional finance without exposing itself to the risks of owning those assets, investors and analysts must have as complete of a picture and understanding of an entity’s leasing activities. The Leases Project will eventually provide the...
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...Guillermo’s Furniture Store Concepts and Principles of Guillermo’s Store Kendall Norman II University of Phoenix Corporate Finance/571 The goal of this paper is to briefly discuss the Guillermo Furniture Store scenario while pointing out and tying key financial concepts and principles discussed in the textbook. The Guillermo Furniture store scenario is about a local furniture manufacturer whose business is located in Sonora, Mexico. He has enjoyed several years of success without any threat of competition. Most recently competition has come about from two different directions. Guillermo has competition via a new international furniture manufacturer who makes the same furniture with better precision, in less time, and at a much cheaper price. The next type of competition comes through the way of development of a new international airport. This is a problem because this airport development will need labor workers. This need will surely drive up the cost of wages, and thus force Guillermo’s hand in the way of increasing his wages for his employees. This is one concept from the text that will be discussed in correlation to Guillermo’s furniture store. Some of the other concepts and/or principles that will be branched into are the concepts of risk aversion, diversification, specification, and time value of money, as well as, the behavior principle, the self interested behavior, and finally the Comparative Advantage Principle. The combination of two forces of...
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...Organizing a Cost- Reduction program The Bottom Line * You need a multidisciplinary team to attain significant cost- reduction. Support from the top helps greatly. * Encounter resistance to the cost reduction effort * There are risks associated with cost – reduction opportunities * Meet at least once a week * Maintain an action plan to create and sustain reduction momentum. * Someone who writes well and is good in capturing details should take notes and publish meeting minutes no later than one day after each meeting. The meeting minutes should be sent to the chief executive, the team members, and the head of each department. Doing this keep others in the loop, and it keeps the effort alive. * The meeting minutes should include “living” task list. Team members should provide input regarding the status of each task in the meeting, and the person preparing the meeting minutes should update the task list to show current status. * The team members should discuss cost- reduction ideas in a free- flowing manner. The ideas may come from the team members or from others in the company. All of the ideas should be captured on a paper. After discussing all of the ideas, the team should decide if each idea should be pursued. If the team thinks an idea has a merit, in most cases it will go to the affected department manager. Key Questions: 1.) Do we have a cost – reduction effort in place? 2.) Do we have cost – reduction targets? 3.) How do we identify and eliminate...
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...There are many different ways to generate ideas. You can use the problem-based concept generation. Using this format, the idea is generated because a problem exits. Using internal company records, input from technical and marketing teams, and most importantly, customer feedback, the problem is identified, and ideas are generated that may be a solution to the specific problem. Although this is a great way to generate ideas, it is not the ideal format for Chocoberry. Chocoberry’s ‘problem’ is an internal one. They want to expand their market and reach customers, as opposed to dealing with just businesses. For this reason, there is no problem they are trying to fix. They are simply trying to come up with a new idea, so problem-based concept generation is not ideal in this situation. One of the most popular methods for idea generation is brainstorming. There are several different options when brainstorming, which eventually lead to the same end result- a concept for a product. Some of the methods of brainstorming include the traditional brainstorming circle, brainsketching, speedstorming, electronic brainstorming, Phillips 66 groups, and the Delphi method of brainstorming. All methods have pros and cons associated with each. One of the most relevant cons associated with brainstorming is the bazooka effect. The bazooka effect occurs when an idea is presented during brainstorming, and someone else shoots it down without even considering it (142). This can cause the participants...
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...curriculum (Devereaux-Melillo, Dowling, Abdallah, Findeisen, & Knight, 2013). The need to examine curricular transformation is imperative in order to manage content saturation, and abate the separation of the classroom and clinical teaching. This paper will outline the following processes: (a) the development of a concept-based curricular plan for a baccalaureate program, (b) the impact of a concept-cased curriculum (CBC) on the faculty, students, finances, community of interests, accreditation, and (c) examples of the integration of competencies. Development of Concept-Based Curricular Plan Nursing faculty are challenged with curriculum, for they are presenting an astronomical amount of material to “cover the content”. According to Duncan and Schulz (2015) nurses practice conceptually on a daily basis by focusing on the patient needs, regardless of the medical diagnoses assigned. In order to practice conceptually, nurses must think conceptually by grouping important facts into concepts that can then be transferred from one clinical situation to another (Benner, Sutphen, Leonard, & Day, 2010). A CBC provides an opportunity for students to transfer the understanding of concepts across multiple areas, make connections to current, and future learning experiences, and underlying issues in complex situations. Needs assessment within the plan. Curriculum development originates at the level of the university’s...
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...effectively, in a way that satisfies its customers. Operations Management is said to be common responsibility of all managers irrespective of which function they are in. A manager needs to be aware of the overall operations of the organisation to contribute well to end to end process/processes. Your Task This assignment requires you to write a report on the operations management of a chosen organisation (preferably a medium sized firm). In the report you must: a) Identify the overall input, transformation and output operations of the firm b) Identify those major operation areas that are critical to the competitive advantage of the chosen organisation c) Critically evaluate the performance of each identified area while using the appropriate concepts (capacity planning, inventory management, supply chain design, performance measures, total quality management) d) Give final recommendations as solution of the identified problems within the operation areas or/and to increase the current efficiency of overall operations management of the chosen organisation (Use information from case...
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...can break really strong relationships, where based on the definition of ‘being willing to depend on the behavior of others and accept a certain vulnerability, assuming that others will not betray us’, so when that ‘other’ person betray you, you are in front of a disloyal person that you cannot rely on him or her. What concepts did you choose to ilustrate the issue you have chosen? The main concepts that we chose and the main reasons were: * Trust We used this concept because they were friends, and Nicolas didn’t have the money to started the business, so their friend trust in all the effort that he put in developed the business and they put more money or their pockets to pay the part of Nicolas. * Fear We used the term Fear, because George worked for more than 2 years to get that money and he felt fear to loss that amount of money, that he worked so hard to get it. * Intuition This concept it used because George had an intuition about that something was missing in the business plan, that was only because he didn’t know all the process that Nicolas follow, George always had been a person that need all in control. * Empathy This concept we used in the situation were George and Rodrigo put the money for Nicolas, they understood that Nicolas didn’t have the money, so they put on his place and with an empathy thought said that they paid for him. * Uncertainly This term we used in the final situation when George said to Nicolas that had a relationship...
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...DFSS Master Black Belt Electronics Business Technical Director for APAC (Shanghai) 3M Taiwan Technical Director (Taiwan) Electronic Solutions Global Technical Director (Singapore) Adjunct Professor NUS Department of Engineering & Technology Management Founded JRW Consulting (www.jrwconsulting.com.sg) (2011) Enjoy distance running, diving, hiking, photography To prepare you for making business decisions, for new businesses, products and services, by providing you with the necessary knowledge and tools. The Basics Technology &Design The Business Sessions 1‐4 Sessions 5‐8 Sessions 9‐13 NPI Systems QFD Intellectual Property Stage Gate Robust Design Business Models Lean NPD Data Analysis Finance Market Assessment Prototyping Value Chain Predictive Engineering Project Management Technology Planning Portfolio Management Customer Engagement We meet every week from 6 – 9 pm. Be on time!! Each week consists of ◦ Quiz or discussion of projects or case studies ◦ Lecture or Presentation on a project relevant topic ◦ Project team preparation Grading ◦ Team project presentation ◦ Final Exam ◦ Class Participation 40% 50% 10% Attendance is taken and is used as part of your participation score. Winning at New Products, Robert G. Cooper, 4th Edition 2011 Perseus Publishing Seizing the White Space: Business...
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...EXECUTIVE SUMMARY A few concepts that I chose from chapter 10 to focus on are executive succession: insiders versus outsiders, problems in retrenchment, managing diverse cultures following an acquisition, and total quality management (TQM). Strategy implementation is an important step that requires staffing and directing and puts strategy into action. According to McCarthy 'strategy implementation may be said to consist of securing resources, organizing these resources, and directing the use of these resources within and outside the organization.' The concept executive succession, is an integral part to a company. Whether to hire an outside or inside manager is better for replacement within a company depends on the circumstances of the company. If a company is doing well, then hiring someone from the inside would improve performance. If a company is on thin ice, hiring an outsider can save the company. Studies have shown that hiring someone from the inside results in better performance than hiring someone from the outside. I've learned that steps for top-management succession is exceptionally critical to a company and can stabilize its performance from sinking below average. A great CEO needs the experience, skills and expertise. Before my research and analysis, I believed that right CEO is one who's been working for the company for long time because of the amount of knowledge captivated during his/her years. However, that's not always the right choice because of circumstance...
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...researching the information that you have provided. Behaviorism (grand theory) The theory that I chose was behaviorism. Behaviorism is a grand theory of the human development and studies the observation of behavior. This theory is also a learning theory it explains the laws and the process as to how people learn to behave. According to John Watson, “if psychologists can focus on behavior, they will realize that everything can be learned.” I can apply this theory to several concepts as it relates to my Christian worldview. The first concept is prayer; the very first prayer that is learned is The Lord’s Prayer. Through behavior you learned this either listening to someone recite this prayer or you learned it by reading the bible. The second concept is worship. Worship is first learned and then through maturity you develop your own sense of worship. Worship is learned at home by parents or those whom you live with or it’s learned at your church by those who you attend worship service with. The last concept is praise. Praise just like worship is a very important part of my worldviews. Praise is a learned behavior because it teaches you how to give honor to God. Again just like worship this is learned through watching those who worship. Behaviorism can...
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...children’s conceptions change during the instructional process and how the social discussion during the experimental exploration can be seen in terms of the cognitive changes in children. Young children’s conceptual change has not been as widely studied as that in older students. The researcher in this case study suggested that conceptual changes as a party of the learning process should be viewed as a life long process, which begins before children enter school. Six-year-old children undergo floating and sinking during their conceptual change process. This article attempted to describe this process and how social discourse during the process of knowledge construction is linked to the change in children’s concepts. Conceptual change had generally been examined only through cognitive functions as a general process without consideration of the context before this case study. The children that were selected for this study were pre-schoolers age six. They all hailed from the city of Joensuu, Finland and were from the kindergarten involved with the ESKO research project. The groups wanted to participate in the study, but the researchers taught the topic after the teachers disagreed. The children came from two different groups in the kindergarten with mixed genders. The research was conducted into three parts: pre-interview, instructional process, and post-interview. The pre-interview consisted of two parts that aimed...
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