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When can the discretionary financing needed (DFN) be determined? - After pro-forma financial statements are forecasted using the percent of sales method When evaluating a company's performance, what can variances on a company's cash budget indicate? - Variances show that certain managers or divisions are not meeting targets. How far into the future do cash budgets usually forecast? - Between one month and one year What are three principles of budgeting that are important to know before be...

=FV(rate, nper, pmt, [pv], [type]) - Returns future value, or cash balance you want after last payment is made. =IRR(values,[guess]) - Returns internal rate of return of series of future payments. =NPER(RATE, PMT, PV, [FV], [type]) - Returns number of payments that will be made to pay an annuity =NPV(rate,value1,[value2],...) - Returns net Present Value of a series of future payments with given rates. Used when payments are uneven. =PMT(rate,nper,pv,[fv],[type]) - Returns payment amount m...

3 main tasks a financial manager of a firm does - makes investment decisions makes financing decisions manages working capital Business Finance - An area of finance that deals with sources of funding, the capital structure of corporations, the actions that managers take to increase the value of the firm to the owners, and the tools and analysis used to allocate financial resources. Capital - A financial asset that can be used by a firm or an individual. Capital Structure - the mixture of ...

coincident indicators - are collected and analyzed as economic shifts happen and include GDP and personal income. flat yield curve: - results when both short-term and long-term bonds have the same interest rate, indicating that the economy is in a transitional state. In what way are coincident indicators useful? - They are analyzed during economic shifts to provide information about the current state of the economy. Correct: coincident indicators help analysts see the big picture of econom...

A large corporation is looking to merge with another large corporation. Which financial institution can help them do this? - Investment bank A specialist - provides liquidity and lowers the cost of trading stocks between sellers and buyers About a year ago, the short-term Treasury bill had 1.54% interest and the long-term Treasury note had 2.54% interest. This week, the 1-year Treasury bill has an interest rate of 3.13%, while the 10-year Treasury note has an interest rate of 2.28%. What do...

A company is trying to finance a project with a mortgage loan from a bank. The company's assessment of the project indicates that the company may experience several years of loss until the project becomes profitable. This means that the company might lose its ability to pay back the loan and the interest on the mortgage. What action might the bank take to protect its interest? - Set a strict covenant that the company cannot easily achieve. bondholders - are more interested in projects that...

Ethics - Accepted standards of conduct that guide a person's behavior Morals - Reflect one's beliefs about right and wrong Legal - Following laws/rules set by and authority Which term reflects a person's beliefs about right and wrong, good and bad, or just and unjust? - Moral What characterizes an ethical action? - An ethical action is based on accepted standards of conduct. Lucas is a financial advisor working for Bullzai, Inc. He is faced with a dilemma. Bullzai has started changin...

3 components of interest rate, or required rate - opportunity cost, risk, and inflation 3 different names used for interest rate - discount rate, required rate, cost 9f capital compound interest - interest earned on both the principal amount and any interest already earned Inflation - is the rate at which the average price level of goods and services increases Interest rate is also called - required rate of return when it refers to the compensation that an investor or lender will accept for...

=FV(rate,nper,pmt,[pv],[type]) - Returns the future value, or the cash balance you want to attain after the last payment is made =IRR(values,[guess]) - Returns the internal rate of return of a series of future payments =NPER(rate,pmt,pv,[fv],[type]) - Returns the number of payment periods in an annuity =NPV(rate,value1,[value2],...) - Returns the net present value of a series of future payments with a given rate =PMT(rate,nper,pv,[fv],[type]) - Returns the payment made each period (this ha...

=FV(rate,nper,pmt,[pv],[type]) - Future Value Function, or the cash balance you want toattain after the last payment is made =IRR(values,[guess]) - internal rate of return of a series of future payments =NPER(RATE, PMT, PV, [FV], [type]) - Returns the number of payment periods in an annuity =NPV(rate,value1,[value2],...) - Returns the net present value of a series of future payments with a given rate =PMT(rate,nper,pv,[fv],[type]) - Returns the payment made each period (this has to be an a...