A Manager’s Guide to Financial Analysis, Sixth Edition
Author: Eliot H. Sherman
Testing Format: multiple choice
Your Price: $159.00
ISBN: 9780761215615
Format: Paper or Softback
Overview
Priceless insight using Powerful FINANCIAL ANALYSIS
Financial analysis is the key to smarter business decisions. It helps companies chart the best course of action—whether identifying operational improvements, evaluating investment choices, or preparing for an acquisition. Covering in-depth financial statement analysis, ratio analysis, asset management, capital structure, and more, this comprehensive course gives students the tools they need to crunch the numbers, focusing on prediction rather than reporting.
Students will learn how to:
• Connect a company’s past experience to future expectations
• Apply the right analytical techniques to problems or decisions
• Identify and explain deviations from anticipated results
• Make needed adjustments to financial statements, taking into account current values, off-balance-sheet financing, and unrecognized items
• Use financial ratios to analyze trends, identify issues, and compare results to the competition and the industry as a whole
• Evaluate capital investments using net present value, internal rate of return, profitability index, and other methods
• Manage current assets including cash, credit and collections, and inventory
• Build a robust financial forecast
• Determine a company’s optimal capital structure and debt policy
• Measure the financial impact of a merger or acquisition
Now completely revised, the sixth edition of A Manager’s Guide to Financial Analysis includes a chapter on forecasting and valuation; sections on alternative asset management, liability and equity; guidance on analyzing return on equity (ROE) using DuPont Analysis; coverage of total asset turnover; updated information on stock repurchases; a glossary of key terms; as well as exercises and review questions throughout to help increase comprehension and reinforce new skills.
Who Will Benefit
Designed for managers who have a basic understanding of accounting and of the structure of financial statements.
Table of Contents
About This Course xi
How to Take This Course xiii
Pre-Test xv
Introduction xxi
1 Financial Decision Making and the Techniques Used in Financial Analysis 1
Financial Analysis
The Role of the Financial Analyst
Financial Management and Financial Analysis
Activities and Financial Statements
Business Strategy
Competitive Environment
The Application of Analytical Techniques for Specific Problems
Primary Goal of Financial Analysis
Long-Range versus Short-Range Goals
The Balanced Scorecard
Techniques Presented in This Course
Recap
Review Questions
2 Financial Statement Analysis 17
Differing Viewpoints
The Basic Structure of Financial Statements
Financial Statement Analysis
Recap
Review Questions
3 Ratio Analysis for Financial Statements 39
Ratio Analysis
Profitability Ratios
Liquidity Ratios
Activity Ratios
Debt and Equity Ratios
Using Financial Ratios
Using Financial Ratios in Analysis
Important Considerations Concerning Financial Statement Information
Alternative Asset Management Treatments
Alternative Liability and Equity Treatments
Recap
Review Questions
4 Analyzing Current Asset Management 85
Cash Management
Accounts Receivable: Credit and Collection Policies
Inventory Management Considerations
Recap
Review Questions
5 Evaluating Capital Investment Proposals 105
The Capital Budgeting Process
Determining the Cost of Capital or Discount Rate
The Cash Flow from an Investment
Risk and Capital Investments
Evaluating Capital Investments
The Post-Audit
Recap
Review Questions
6 Forecasting and Valuation 143
Forecasting the Future
Constructing a Valuation Model
Recap
Review Questions
7 Capital Structure and Dividend Policy 155
Issues in Capital Structure and Dividend Policy
Business and Financial Risk
Optimal Capital Structure
Dividend Policy
Recap
Review Questions
8 Mergers and Acquisitions 171
Motives for Mergers
Search and Screening
Measuring the Financial Impact of an Acquisition
The Impact on Earnings per Share
The Impact on the Price-Earnings Ratio
Valid and Invalid Motives for Merging
Expected Return from an Acquisition or Merger
Recap
Review Questions
Answers to Quick Quiz Questions 191
Bibliography 197
Additional Resources 199
Glossary 201
Post-Test 213
Index 219