Introduction to Business



Advanced Financial Management

Business 401 Section 1 (Daily, 2:00-3:15 p.m.)

SMI 453

Winter 2006

Credits: 3 Semester Hours

Prerequisite(s): Pre-Business Core and B301 (see catalog)

Instructor: James Taylor; Office: Smith 309; Phone: x2696; Email: taylorja@byui.edu

Office Hours: MWTh 4:00-5:00 p.m., F 8:00-9:00 (other times by appointment).

Messages may be left via voice mail, or with the Business Management secretary’s office (SMI)

Required Texts: Cases in Financial Management, 2nd Edition, Sulock & Dunkelberg, Wiley Publishing

Financial Analysis, 3rd Edition, Mayes & Shank, Thompson South-Western Publishing

Other Requirements:

▪ It is required that students have access to a calculator that handles financial functions, including time value of money calculations and cash flow analysis (IRR / NPV). The instructor strongly recommends the HP 10BII. Specific instructions will only be provided in class for this calculator. (Students who choose to use any other calculator must refer to their user manuals for instructions on how to use their calculator.)

▪ Students must be proficient in Excel and have regular computer access in order to pass this class.

Course Description:

An advanced corporate finance course covering key topics and issues found in the corporate setting. Topics include advanced coverage of time value of money, asset valuation, capital decision-making, cost of capital, financial statement analysis, cash budgets, financial forecasting, and business ethics.

Course Objectives:

▪ Develop and enhance each student’s understanding of corporate finance through discussions about key concepts taught in the textbooks and insights from the instructor’s professional experience.

▪ Create and develop spreadsheet-modeling skills to help students understand and apply key principles and concepts used in the corporate setting.

▪ Study, discuss, and analyze several financial management cases to further enhance problem-solving and analytical skills.

▪ Foster in-depth case analyses through the use of study groups, development of spreadsheet models, and student involvement in class discussions.

▪ Practice critical thinking skills on an individual and team basis.

▪ Relate concepts, principles, and skills discussed in the course to principles taught in economics, statistics, general business, international business, and computer information systems.

▪ Develop portable skills that can be utilized in many areas of business.

▪ Understand and expand finance related vocabulary.

Evaluation:

Exams (2) 150 points (75 points each)

Case Quizzes 120 points (15 points each)

Chapter Quizzes 40 points (5 points each)

Group Case Presentations/Analysis 30 points

Worksheets 70 points (5 points each)

In-Class Exercises 10 points (1 point each)

Total 420 points

Grading Scale:

93-100% -- A 73-76.99% -- C

90-92.99% -- A- 70-72.99% -- C-

87-89.99% -- B+ 67-69.99% -- D+

83-86.99% -- B 63-66.99% -- D

80-82.99% -- B- 60-62.99% -- D-

77-79.99% -- C+ 0-59.99% -- Fail

NOTES:

Exams: There will be two in-class exams given during the course of the term. Each exam will be worth 75 points and will cover excel skills, chapter reading, and application of case concepts.

Case Quizzes: Students will be required to analyze ten cases during the course of the term. Case study groups will be used for presentation purposes. However, at the beginning of each day upon which a case is to be presented, there will be a short quiz which will be taken on an individual basis. For the quiz, students will be allowed to access their models or case preparation work.

Chapter Quizzes: Students will be required to know the material covered in 8 chapters from the Excel text. On the day when a reading assignment is due, students will take a quiz to assess their understanding of the reading material.

Case Presentations: Students will be assigned in teams of three or four to analyze cases. On the day when a case analysis is due, each group should provide a one-page summary and a print-out of their quantitative analysis. Students should be prepared on any given day to present the case for the class. Students will also be expected to provide an analysis of how their work compares with that of other student groups.

Worksheets: During the course of the term, students will be required to prepare several excel spreadsheets to perform various corporate finance functions Students will be required to audit the work of other students and provide input on accuracy and presentation.

In-Class Exercises: The teacher will provide some worksheets during class and which will be turned in at the end of class. Approximately ten of these exercises will be given.

Class Policies:

• Attendance is important. Although attendance is not recorded, please be aware that some test material will come from in-class lectures, as well as from the text and other reading materials. In addition, case assignments and “in-class” homework assignments will be handed out and turned in during class. These assignments will not always be announced or listed on the schedule.

• If you miss class for any reason, it is your responsibility to contact a classmate or the instructor (during office hours) to determine if any assignments were made or schedules changed.

• There is no extra credit.

• Late work will be marked down by 50% and must be turned in by the end of the next day. No assignments will be accepted after the final day of class. Assignments will be accepted early.

• If an assignment is late due to a legitimate medical emergency or family emergency, please contact the Instructor via voice mail, email, etc. and we will work out a reasonable schedule. Please turn in class work early if you plan to miss a class for personal (non-emergency) reasons.

• Grading updates on web site – If you prefer that the teacher NOT use the last four digits of your social security number to identify your work, please provide your own substitute four digit code.

• Please turn off cell phones before the start of class

• No food is allowed in class

• Do not “surf” during class

• While students are encouraged to study in groups, worksheet assignments are to be produced independently.

• Code of Honor and Grooming standards will be observed in the classroom and in the testing center.

• IN COMPLIANCE WITH APPLICABLE DISABILITY LAW, QUALIFIED STUDENTS WITH A DISABILITY MAY BE ENTITLED TO “REASONABLE ACCOMMODATION.” IT IS THE STUDENT’S RESPONSIBILITY TO DISCLOSE TO APPROPRIATE PERSONNEL IN THE SSD OFFICE ANY SPECIAL NEED HE OR SHE MAY HAVE AND TO PROVIDE THE APPROPRIATE DOCUMENTATION OF THE DISABILITY. THE SSD OFFICE IS LOCATED INSIDE THE LEARNING ASSISTANCE CENTER, MCKAY LIBRARY 1ST FLOOR.

Class Schedule: The following represents a tentative schedule for this class. The instructor reserves the right to make changes, deletions, corrections, or additions during the course. You will be given notice in advance of any changes. Assignments are from required text, unless otherwise noted.

|Date |Discussion Topic |Reading Assignment |Assignment(s) due today: |Special Notes: |

|January |

|9 Mon |Introduction | | | |

|11 Wed |Spreadsheet Basics |Excel: Ch 1 | |Quiz: Excel Ch 1 |

|16 Mon |Holiday – No Class |No Class | | |

|18 Wed |Financial Statement Analysis |Excel: Ch 4 |Worksheet 1- Graphing |Quiz: Excel Ch 4 |

|23 Mon |Financial Statement Analysis |Case 7 |Worksheet 2 – Amortization (“if”) |Quiz – Case 7 |

|25 Wed |Forecasting |Excel: Ch 5 | |Quiz – Excel Ch 5 |

|30 Mon |Forecasting | |Worksheet 3 – Forecasts Worksheet 4 – | |

| | | |Auto Maintenance | |

|February | | | | |

|1 Wed |Forecasting |Case 12 | |Quiz – Case 12 |

|6 Mon |Breakeven Analysis & Leverage |Excel: Ch 6 | |Quiz – Excel Ch 6 |

|8 Wed |Breakeven Analysis & Leverage | |Worksheet 5 – Breakeven | |

|13 Mon |Breakeven Analysis & Leverage |Case 9 | |Quiz – Case 9 |

|15 Wed |No- Class |No Class | | |

|20 Mon |Holiday – No Class |No Class | | |

|22 Wed |Time Value of Money |Excel: Ch 7 | |Quiz – Excel Ch 7 |

|27 Mon |Time Value of Money | |Worksheet 6 – TVM | |

|March | | | | |

|1 Wed |Time Value of Money |Case 1 | |Quiz – Case 1 |

|6 Mon |Time Value of Money |Case 2 | |Quiz – Case 2 |

|8 Wed |Exam #1 | | |Exam #1: 1,4,5,6,7 |

|13 Mon |Valuation & Rate of Return/ Bonds |Excel: Ch 8 | |Quiz – Excel Ch 8 |

|15 Wed |Valuation & Rate of Return / Stock | |Worksheet 7 – Bonds | |

|20 Mon |Valuation & Rate of Return |Case 3 |Worksheet 8 – Stock |Quiz – Case 3 |

|22 Wed |Cost of Capital |Excel: Ch 9 | |Quiz – Excel Ch 9 |

|27 Mon |Cost of Capital | |Worksheet 9 – Cost of Capital | |

|29 Wed |Cost of Capital |Case 30 | |Quiz – Case 30 |

|April | | | | |

|3 Mon |Capital Budgeting |Excel: Ch 10 | |Quiz – Excel Ch 10 |

|5 Wed |Capital Budgeting | |Worksheet 10 – Capital Budget 1 | |

|10 Mon |Capital Budgeting |Case 21 |Worksheet 11 – Capital Budget 2 |Quiz – Case 21 |

|12 Wed |Project Proforma – Cost, Draw, Amort, | | | |

| |Dep | | | |

|17 Mon |Project Proforma – Op, MM, ATCF | |Worksheet 12 – Cost, Draw, Amort, Dep | |

|19 Wed |Project Proforma – Summary, Log, | |Worksheet 13 – Op, MM, ATCF | |

| |Sensitivity | | | |

|24 Mon |Review | |Worksheet 14 – Summary, Log, | |

| | | |Sensitivity | |

|27 Thur |Final – 8:00-10:00 p.m. | |Final |Exam #2: 8,9,10, PP |

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