Do you want to understand the impacts financial decisions have on the value of companies? Ideal for those new to financial management, this sparklingly clear text cuts through the mire of the financial decision-making process. A practical and reliable book, free from technical errors, backed up by a wealth of award-winning support material. Fundamentals of Financial Management is your route to understanding the impacts of financial decisions on value creation.Covers the 3 key areas of financial management decisions:*investment*financing*asset management"wonderful book" Enrico Gallina, The European School of Economics, Italy"this is the best book I have found so far" Jean Bellemans, VUB, Belgium"A classic book that is probably the best that has been written. My students like the book. I find it very significant that the students are not confused by the material or terminology." Peter Went, Bucknell University, USA"an informative, entertaining website" Strategic Finance MagazineIdeal for introductory courses in financial management. It is also useful for those studying for a professional qualification or as a reference for practitioners.Suggested reading for Certified Financial Manager (CFM) and Certified Management Accountant (CMA) examinations.
James C. Van Horne, Professor of Banking and Finance at Stanford University, is also the author of Financial Management and Policy, a Pearson Education text.John M. Wachowicz JR. is Professor of Finance at The University of Tennessee
Table of Contents
PART ONE: INTRODUCTION TO FINANCIAL MANAGEMENT 1. The Role of Financial Management 2. The Business, Tax and Financial Environments PART TWO: VALUATION 3. The Time Value of Money 4. The Valuation of Long-Term Securities 5. Risk and Return Appendix A: Measuring Portfolio Risk Appendix B: Arbitrage Pricing Theory PART THREE: TOOLS OF FINANCIAL ANALYSIS AND PLANNING 6. Financial Statement Analysis Appendix: Deferred Taxes and Financial Analysis 7. Funds Analysis, Cash-Flow Analysis, and Financial Planning Appendix: Sustainable Growth Modeling PART FOUR: WORKING CAPITAL MANAGEMENT 8. Overview of Working Capital Management 9. Cash and Marketable Securities Management 10. Accounts Receivable and Inventory Management 11. Short-Term Financing PART FIVE: INVESTMENT IN CAPITAL ASSETS 12. Capital Budgeting and Estimating Cash Flows 13. Capital Budgeting Techniques Appendix A: Multiple Internal Rates of Return Appendix B: Replacement Chain Analysis 14. Risk and Managerial Options in Capital Budgeting PART SIX: THE COST OF CAPITAL, CAPITAL STRUCTURE, AND DIVIDEND POLICY 15. Required Returns and the Cost of Capital Appendix A: Adjusting the Beta for Financial Leverage Appendix B: Adjusted Present Value 16. Operating and Financial Leverage 17. Capital Structure Determination 18. Dividend Policy PART SEVEN: INTERMEDIATE AND LONG-TERM FINANCING 19. The Capital Market 20. Long-Term Debt, Preferred Stock, and Common Stock Appendix: Refunding A Bond Issue 21. Term Loans and Leases Appendix: Accounting Treatment of Leases PART EIGHT: SPECIAL AREAS OF FINANCIAL MANAGEMENT 22. Convertibles, Exchangeables, and Warrants Appendix: Option Pricing 23. Mergers and Other Forms of Corporate Restructuring Appendix: Remedies for a Failing Company 24. International Financial Management