Introduction to Business Finance

MBA – III
DBA – 611

1. An overview of Business Finance

• GAAP revisited
• Basic Finance Statement
• Legal Forms of Organization

2. Corporation defined: Advantages and Disadvantages

• Formation of a Corporation
• Capital Stock, Authorization and Issuance
• Rights of a Shareholder
• Common and Preferred Stocks
• Types of Preferred Stocks
• Payment of Dividends

3. The Firm’s Investment Decision

• An overview of the Capital Budgeting Process
• Capital Budgeting Techniques
• Payback Period
• Accounting rate of return (ARR)
• Net Present value (NPV)
• Internal Rate of Return (IRR)
• Profitability Index (P/I)
• Sensitivity Analysis

4. The Time Value of Money

• Compounding and discounting
• Finding Future and Present Values

5. Financial Ratio Analysis

• Types of Financial Ratios
• Uses of Financial Ratios
• Determination and Interpretation
• Limitations of Ratios

6. Working Capital Management

• The Importance of Working Capital
• Short-term Finance Decision
• Deciding on an Appropriate WC Policy

Recommended Books:

1. Fundamentals of Financial Management
2. by Ramesh K. S. Rao
3. Macmillan Publishing Company
4. International Edition:
5. A. Stevenson, ‘‘Fundamentals of Finance’’, McGraw-Hill,
6. Latest Edition.
7. H. Chew, JR, ‘’The New Corporate Finance’’ , McGraw-Hill
8. Second Edition.
9. Eugene Brigham, “Fundamentals of Financial Management” , Duden Press,
10. Harcourt Bare College Publisher