The Relationship of Financial Management to Other Functional Areas of Management. Organization of the Firm. A Basic Understanding of Financial Management. Wealth Maximization. A General Outline of the Textbook.
2. Financial Markets and Financial Instruments.
Why People Invest. Capital Markets. Money Market. Raising Financial Capital and Security Trading. Financial Markets and Hedging Risk. Key Financial Intermediaries: Lenders to the Hospitality Industry. Stock Market Performance.
3. Review of Financial Statements and Selected Ratios.
Review of the Income Statement. Review of the Balance Sheet. Relationship Between the Income Statement and the Balance Sheet. Statement of Retained Earnings. Statement of Cash Flows. Validity of Financial Statements. Ratio Analysis. Perspectives on and Limitations of Ratio Analysis.
4. The Relationship Between Risk and Return.
How Typical Investors Feel About Risk. Returns and Distributions. Diversification. The Market Portfolio. The Market Portfolio and Beta. Beta, Expected Return and the Security Market Line.
5. Time Value of Money.
Future Value—Compounding. Present Value—Discounting. Future Value of an Annuity. Present Value of an Annuity. Perpetuity—An Infinite Annuity. Present Value of a Series of Non-Constant Cash Flows. Compounding Periods Other Than Annual. Effective Annual Rates. Amortized Loans.
6. Fixed Income Securities: Bonds & Preferred Stock.
Basic Bond Terminology. Bond Features. Bond Ratings. Valuing Corporate Bonds. Computing Yield to Maturity on Corporate Bonds. Bonds with Semi-Annual Coupon Payments. Basic Preferred Stock Terminology. Preferred Stock Features. Valuing Preferred Stock.
7. Common Stock.
Common Stock Features. Valuing Common Stock. General Dividend Valuation Model. Zero-Growth Dividend Valuation Model. Constant-Growth Dividend Valuation Model. Valuing Common Stock with Multiple Growth Rates. Common Stock Value, Investors Rate of Return and Growth.
8. Cost of Capital.
The Weighted Average Cost of Capital. Estimating the Cost of Capital Components. The Cost of Debt. The Cost of Preferred Stock. Internal Common Equity—New Retained Earnings. Dividend Valuation Model Method for Estimating the Cost of Internal Equity. The Bond Yield Plus Risk Premium Method for Estimating the Cost of Internal Equity. External Common Equity—New Issues of Common Stock. Computation of the Weighted Average Cost of Capital. Using the Weighted Average Cost of Capital.
9. Introduction to Capital Budgeting and Cash Flow Estimation.
Classifying Capital Budgeting Projects. The Captial Budgeting Decision and Cash Flow Estimation.
10. Capital Budgeting Decision Methods.
Captial Budgeting Decision Methods. Independent Projects and Capital Budgeting Decision Methods. Mutually Exclusive Projects and Capital Budgeting. Not Normal Cash Flows. The Use of Captial Budgeting Decision Methods.
11. An Introduction to Hotel Valuation.
Reasons for a Hotel Appraisal. The Hotel Appraisal Process. Approaches to Value. A Rule of Thumb Approach and Revenue Multipliers. Final Reconciliation of Value.
12. Capital Structure.
Financial Risk. Business Risk. Capital Structure Theory. Other Significant Factors in the Determination of a Firms Capital Structure.