MBA 702 Module 1
What is Finance? - answer finance covers anything to do with the use and mgt of
money
- derived from econ
Successful firms are able to - answer- identify, create, and deliver products or services
that are highly valued by customers.
- sell products at high enough price to cover costs and to compensate owners/creditors
for their risk exposure
Key attributes of successful companies - answer- skilled people
- strong relationships
- sufficient funding
What long-term investments should the firm take on? - answer capital budgeting
where will we get the long term financing to pay for the investment? - answer capital
structure
How will we manage the everyday financial activities of the firm? - answerworking
capital
CFO - answerTop financial manager within a firm
Controller - answerhandles cost and financial accounting, tax payments, and
management information systems
Treasurer - answerhandles cash management, financial planning, and capital
expenditures
Capital budgeting - answerthe process of planning and managing a firm's investments in
fixed assets
capital structure - answermix of debt and equity used by a firm
working capital mgt - answermanaging short term assets and liabilities
Three Types of Business Organizations - answersole proprietorship, partnership,
corporation
Sole proprietorships and partnerships combined represent roughly __% of active
businesses and __% of the overall value of businesses in the US. - answer80,20
What is Finance? - answer finance covers anything to do with the use and mgt of
money
- derived from econ
Successful firms are able to - answer- identify, create, and deliver products or services
that are highly valued by customers.
- sell products at high enough price to cover costs and to compensate owners/creditors
for their risk exposure
Key attributes of successful companies - answer- skilled people
- strong relationships
- sufficient funding
What long-term investments should the firm take on? - answer capital budgeting
where will we get the long term financing to pay for the investment? - answer capital
structure
How will we manage the everyday financial activities of the firm? - answerworking
capital
CFO - answerTop financial manager within a firm
Controller - answerhandles cost and financial accounting, tax payments, and
management information systems
Treasurer - answerhandles cash management, financial planning, and capital
expenditures
Capital budgeting - answerthe process of planning and managing a firm's investments in
fixed assets
capital structure - answermix of debt and equity used by a firm
working capital mgt - answermanaging short term assets and liabilities
Three Types of Business Organizations - answersole proprietorship, partnership,
corporation
Sole proprietorships and partnerships combined represent roughly __% of active
businesses and __% of the overall value of businesses in the US. - answer80,20
