Browse by Subject New Releases Bestsellers Finance and Accounting for NonFinancial Managers, Third Edition
Author: Eliot H. Sherman
Credit: 2.0 CEUs
Testing Format: multiple choice
Your Price: $159.00
ISBN: 9780761214892
Format: Spiral/Comb/Coil Binding
Overview
Finance and Accounting for Nonfinancial Managers, Third Edition, introduces the reader to financial terminology, relates financial measures to operating information, enables the student to understand and apply financial measures to operating performance, and ties all of this to the current business environment. Today’s managers, whether supervisors or senior executives, are expected to understand and use financial and operational measures, prepare and utilize budgets, respond to inquiries about the financial consequences of actions taken by them or by their department or team, and understand and use financial and accounting terminology—the common language of business measurement. Written in a conversational, easy-to-understand tone, the course treats finance and accounting from the perspective of users of financial information—it enhances their ability to communicate effectively with subordinates, other managers, senior executives, and accounting and finance professionals. It offers managers the ability to use and analyze financial information to improve the performance of their operations and to identify—and avoid—potential problems.
The third edition includes discussion of the continuing transition of financial reporting to an international standard as well as consideration of the effects on accounting and finance resulting from the Recession of 2007-2009. New sections on how to read an annual report and navigating the shifts in the marketplace are also included. This edition has been updated throughout to provide managers with the most current and complete information available.
Selected Learning Objectives
Participants will learn how to:
Prepare budgets
Read, understand, and use financial and operational measures
Manage short-term assets
Relate department performance to the big picture
Testing Format
This course contains one multiple choice test valued at 2 CEU’s (continuing education units).
TOC
Contents
About This Course xi
How to Take This Course xiii
1 Introduction to Finance 1
Overview
The Vocabulary of Finance
The Elements of Finance
Bookkeeping
Accounting
Planning
Cash Management
The Basic Financial Statements
The Balance Sheet
The Income Statement
Statement of Cash Flows
Statement of Retained Earnings
The Structure of Business and the Impact of Financial Statements
Proprietorship
Partnership
Corporation
Other Business Structures
How to Read an Annual Report
The Company-Produced Annual Report
Cover Material Plus the Form 10-K
Communication of the Annual Report
Recap
Review Questions
2 Introduction to Accounting 25
Overview
The Purpose of Accounting
The Accounting System
Who Uses Accounting Information?
Basic Terminology
Financial Statements
The Chart of Accounts
The Accounting Cycle
Using Journal Entries to Record Transactions
Closing Procedures
More Financial Concepts
Preparing Financial Statements
The Key Financial Statements
Trial Balance
Recap
Review Questions
3 Financial Analysis: Using Ratios 49
Overview
Analysis of Financial Information
The Purpose of Business
Who Performs Financial Analysis?
The Power of Ratios
Comparative Analysis
Trend Analysis
Traditional Ratio Analysis
Liquidity Ratios
Activity Ratios
Profitability Ratios
Operating Profit Margin
Debt Management Ratios
DuPont Analysis
A Different Perspective
Creating Other Ratios
Conflicting Information
Recap
Review Questions
4 Managing Operating Performance 73
Overview
Making Your Information Useful
The Key Financial Statements
Ratios That Help Tell the Company’s Story
Effect Ratios
Crossover Indicators and Causal Ratios
Recap
Review Questions
5 Managing Short-Term Assets 95
Overview
The Management of Cash
Reasons for Holding Cash
Techniques for Managing Cash
The Management of Other Short-Term Assets
Managing Marketable Securities
Managing Accounts Receivable
Managing Inventory
Prepaid Expenses
Other Current Assets
Recap
Review Questions
6 Relating Risk and Return, Valuation, 111
and Time Value of Money
Overview
Risk
Defining Risk
Risk Aversion vs. Risk Taking
Possibility of Loss
The Determination of Interest Rates
Types of Risk
Characteristics of Different Types of Risks
Default Risk
Inflation Risk
Maturity Risk
Liquidity Risk
Estimating Interest Rates
Interest Rates and the Economy
The Role of the Federal Reserve on Interest Rate Determination
Capital Asset Pricing Model
Relating Risk and Return
Extending the Theory
Time Value of Money
Valuation
An Illustrative Example
Assessing Investments
Valuing an Investment
Recap
Review Questions
7 Capital Investment Decision Making 133
Overview
Calculating the Cost of Capital
The WACC Model
Initial Exercise in Estimating Financing Requirements
Calculating the Cost of Capital
Capital Budgeting
Types of Capital Investment Projects
Applying Cost of Capital
Determining Investment Cost
Determining the Cash Flows of a Project
Determining the Terminal Cash Flows
Evaluating Capital Investment Projects
Payback Period
Discounted Payback Period
Net Present Value (NPV)
Internal Rate of Return (IRR)
Modified Internal Rate of Return (MIRR)
Time Value of Money Calculations Using Excel
Recap
Review Questions
8 Managing Long-Term Assets 157
Overview
Considering Asset Classification
The Investment in Fixed Assets
Depreciation
Fixed Asset Accounting
Acquisition of Fixed Assets
Other Long-Term Assets
Recap
Review Questions
9 Managing Liabilities 169
Overview
The Liabilities of the Business
Short-Term or Current Liabilities
Accounts Payable
Notes Payable
Taxes Payable
Accruals
Long-Term Debt
Access to Credit
Choosing a Bank Lending Officer
The “C’s” of Credit
Character
Capacity
Capital
Cash Flow
Collateral
Conditions
Competition
Credibility
Competence
Communications
Covenants
Coverage
Banking Relationships
Defining Debt
Bank Structure Dictates Loan Interest Rates
The Cost of Bank Funds
Operating Expenses
Loan Losses
Profit Criteria
Comparison to Traditional Business Cost Structure
Bank Debt Pricing
Loan Pricing Example
Recap
Review Questions
10 The Equity in the Business 199
Overview
Equity and Business Structure
Preferred Stock
Common Stock
Additional Paid-in Capital
Retained Earnings
Other Equity Accounts
Stock Repurchase Plans
The Investment Marketplace
Accounting for Equity
Recap
Review Questions
11 Financial Planning 213
Overview
The Essence of Financial Planning
Business Planning—A Continuous Process
Roles of the Key Players
Overview of the Financial Planning Process
Planning Sequence
The Business Planning Process
Business Plan
Strategic Plan
The Operative Plan or Annual Budget
Projecting the Financial Future
Estimating Financial Requirements
Capital Budgets
Cash Budgets
Recap
Review Questions
12 Corporate Governance and Financial 235
Integrity
Overview
Sarbanes-Oxley
Defining Corporate Governance
The Major Corporate Scandals Preceding Sarbanes-Oxley
Enron
WorldCom
Scandal Summary
Post-SOX Financial Failures
Bernard Madoff
American International Group (AIG)
Goldman Sachs
Dell Computer
The Response of the Federal Government to the Financial Crisis
The Broader Aspects of Corporate Governance
EVA and MVA
Executive Compensation
Recap
Review Questions
13 Relating Departmental Performance to 251
the Big Picture
Overview
The Inverted Triangle: Finance from Broad to Specific
The Company
Subsidiary
Division
Department
Group
Individuals
The Relationship Between Budgets and Actuals
Navigating the Shifts in the Marketplace
Recap
Review Questions
Appendix A: Time Value of Money Tables 263
Appendix B: The Sarbanes-Oxley Act of 2002 269
Glossary 273
The Final Exam 285
Index