Enviar búsqueda
Cargar
1. chapter 1 introduction of Finance
•
Descargar como PPT, PDF
•
80 recomendaciones
•
84,055 vistas
AfiqEfendy Zaen
Seguir
Economía y finanzas
Denunciar
Compartir
Denunciar
Compartir
1 de 30
Descargar ahora
Recomendados
Chapter 1 Introduction to Financial Management
Chapter 1 Introduction to Financial Management
Safeer Raza
Chapter 8 risk and return
Chapter 8 risk and return
Chang Keng Kai Kent
2. financial statement cash flow
2. financial statement cash flow
AfiqEfendy Zaen
Chapter 4 (b)employment income
Chapter 4 (b)employment income
Charmaine Deirdre Dave
Financial market and institutions
Financial market and institutions
Hung Tran
1. introduction to corporate finance
1. introduction to corporate finance
irfan_1
Chapter 1 – financial management
Chapter 1 – financial management
CMA Khursheed Ahmad Bhat
Dividend policy
Dividend policy
Pooja Narwani
Recomendados
Chapter 1 Introduction to Financial Management
Chapter 1 Introduction to Financial Management
Safeer Raza
Chapter 8 risk and return
Chapter 8 risk and return
Chang Keng Kai Kent
2. financial statement cash flow
2. financial statement cash flow
AfiqEfendy Zaen
Chapter 4 (b)employment income
Chapter 4 (b)employment income
Charmaine Deirdre Dave
Financial market and institutions
Financial market and institutions
Hung Tran
1. introduction to corporate finance
1. introduction to corporate finance
irfan_1
Chapter 1 – financial management
Chapter 1 – financial management
CMA Khursheed Ahmad Bhat
Dividend policy
Dividend policy
Pooja Narwani
5 non-bank financial intermediaries
5 non-bank financial intermediaries
Hajar Hafizah
GITMAN Chapter 1
GITMAN Chapter 1
Mikee Bylss
Corporate Finance: Basic Concept
Corporate Finance: Basic Concept
Maksudul Huq Chowdhury
Chapter 1: Overview of Financial Management
Chapter 1: Overview of Financial Management
Mikee Bylss
Chapter 1 introduction to investment
Chapter 1 introduction to investment
Suhairi Yunus
Financial Management
Financial Management
ASM's IBMR- Chinchwad
Direct and Indirect Financing
Direct and Indirect Financing
Danish Riaz
Unit 1 introduction to investment & portfolio management
Unit 1 introduction to investment & portfolio management
Shaik Mohammad Imran
Capital structure
Capital structure
Jubayer Alam Shoikat
Managerial Finance By Gitman Chapter 8 solutions
Managerial Finance By Gitman Chapter 8 solutions
Qaisar Mehar
Types of investment
Types of investment
Aswin prakash i , Xantus Technologies
An introduction to investment
An introduction to investment
Gevani Prahalathan
Chapter 2 financial statement, taxes, and cash flow
Chapter 2 financial statement, taxes, and cash flow
Chang Keng Kai Kent
Banking and non-banking financial institutions
Banking and non-banking financial institutions
Twinkle Jasani
Chapter 2 Financial Markets & Institutions
Chapter 2 Financial Markets & Institutions
Mikee Bylss
investment
investment
ghanchifarhan
ch.1 The role of finance management
ch.1 The role of finance management
Dasrat goswami
Chapter 3 - Time Value of Money
Chapter 3 - Time Value of Money
umarhnasution
basics of finance
basics of finance
ayushi jain
financial management stock valuation chapter solution ...MOHSIN MUMTAZ
financial management stock valuation chapter solution ...MOHSIN MUMTAZ
mianmohsinmumtazshb
Financial mangement
Financial mangement
Rehanali154
BUSFIN - Chapter 01
BUSFIN - Chapter 01
Anjelica Cuenca
Más contenido relacionado
La actualidad más candente
5 non-bank financial intermediaries
5 non-bank financial intermediaries
Hajar Hafizah
GITMAN Chapter 1
GITMAN Chapter 1
Mikee Bylss
Corporate Finance: Basic Concept
Corporate Finance: Basic Concept
Maksudul Huq Chowdhury
Chapter 1: Overview of Financial Management
Chapter 1: Overview of Financial Management
Mikee Bylss
Chapter 1 introduction to investment
Chapter 1 introduction to investment
Suhairi Yunus
Financial Management
Financial Management
ASM's IBMR- Chinchwad
Direct and Indirect Financing
Direct and Indirect Financing
Danish Riaz
Unit 1 introduction to investment & portfolio management
Unit 1 introduction to investment & portfolio management
Shaik Mohammad Imran
Capital structure
Capital structure
Jubayer Alam Shoikat
Managerial Finance By Gitman Chapter 8 solutions
Managerial Finance By Gitman Chapter 8 solutions
Qaisar Mehar
Types of investment
Types of investment
Aswin prakash i , Xantus Technologies
An introduction to investment
An introduction to investment
Gevani Prahalathan
Chapter 2 financial statement, taxes, and cash flow
Chapter 2 financial statement, taxes, and cash flow
Chang Keng Kai Kent
Banking and non-banking financial institutions
Banking and non-banking financial institutions
Twinkle Jasani
Chapter 2 Financial Markets & Institutions
Chapter 2 Financial Markets & Institutions
Mikee Bylss
investment
investment
ghanchifarhan
ch.1 The role of finance management
ch.1 The role of finance management
Dasrat goswami
Chapter 3 - Time Value of Money
Chapter 3 - Time Value of Money
umarhnasution
basics of finance
basics of finance
ayushi jain
financial management stock valuation chapter solution ...MOHSIN MUMTAZ
financial management stock valuation chapter solution ...MOHSIN MUMTAZ
mianmohsinmumtazshb
La actualidad más candente
(20)
5 non-bank financial intermediaries
5 non-bank financial intermediaries
GITMAN Chapter 1
GITMAN Chapter 1
Corporate Finance: Basic Concept
Corporate Finance: Basic Concept
Chapter 1: Overview of Financial Management
Chapter 1: Overview of Financial Management
Chapter 1 introduction to investment
Chapter 1 introduction to investment
Financial Management
Financial Management
Direct and Indirect Financing
Direct and Indirect Financing
Unit 1 introduction to investment & portfolio management
Unit 1 introduction to investment & portfolio management
Capital structure
Capital structure
Managerial Finance By Gitman Chapter 8 solutions
Managerial Finance By Gitman Chapter 8 solutions
Types of investment
Types of investment
An introduction to investment
An introduction to investment
Chapter 2 financial statement, taxes, and cash flow
Chapter 2 financial statement, taxes, and cash flow
Banking and non-banking financial institutions
Banking and non-banking financial institutions
Chapter 2 Financial Markets & Institutions
Chapter 2 Financial Markets & Institutions
investment
investment
ch.1 The role of finance management
ch.1 The role of finance management
Chapter 3 - Time Value of Money
Chapter 3 - Time Value of Money
basics of finance
basics of finance
financial management stock valuation chapter solution ...MOHSIN MUMTAZ
financial management stock valuation chapter solution ...MOHSIN MUMTAZ
Similar a 1. chapter 1 introduction of Finance
Financial mangement
Financial mangement
Rehanali154
BUSFIN - Chapter 01
BUSFIN - Chapter 01
Anjelica Cuenca
gitm.pdf
gitm.pdf
RabiyaKasu1
1588252323-gitman-pmf13-ppt01.ppt
1588252323-gitman-pmf13-ppt01.ppt
ayeshaawan42
Chapter 1 - The Role of Financial Management
Chapter 1 - The Role of Financial Management
umarhnasution
Ch01
Ch01
Institute of management studies (UOP)
Ch01
Ch01
Aqsa Ch
3 financial ratio
3 financial ratio
AfiqEfendy Zaen
Introduction.pptx
Introduction.pptx
asdfg hjkl
The role of financial mangerial
The role of financial mangerial
Zubair Arshad
Chapter 3 financial analysis
Chapter 3 financial analysis
Chang Keng Kai Kent
Case study
Case study
Richa Manjhi
Ch01
Ch01
mameyaonu
1.ppt
1.ppt
JunaidKhan622004
A Business Process Approach
A Business Process Approach
ali_us
FINANCIAL MANAGEMENT
FINANCIAL MANAGEMENT
Mehmood Hussain
An Understanding Of Financial Communications And Investor Relations
An Understanding Of Financial Communications And Investor Relations
MSL
Introduction to Business Finance and its importance.
Introduction to Business Finance and its importance.
sadiaumarahmed
266458904-The-role-of-financial-management-ppt.ppt
266458904-The-role-of-financial-management-ppt.ppt
PHEGIELHONCULADAMAGA1
Ten principles of fm
Ten principles of fm
IvanDuran38
Similar a 1. chapter 1 introduction of Finance
(20)
Financial mangement
Financial mangement
BUSFIN - Chapter 01
BUSFIN - Chapter 01
gitm.pdf
gitm.pdf
1588252323-gitman-pmf13-ppt01.ppt
1588252323-gitman-pmf13-ppt01.ppt
Chapter 1 - The Role of Financial Management
Chapter 1 - The Role of Financial Management
Ch01
Ch01
Ch01
Ch01
3 financial ratio
3 financial ratio
Introduction.pptx
Introduction.pptx
The role of financial mangerial
The role of financial mangerial
Chapter 3 financial analysis
Chapter 3 financial analysis
Case study
Case study
Ch01
Ch01
1.ppt
1.ppt
A Business Process Approach
A Business Process Approach
FINANCIAL MANAGEMENT
FINANCIAL MANAGEMENT
An Understanding Of Financial Communications And Investor Relations
An Understanding Of Financial Communications And Investor Relations
Introduction to Business Finance and its importance.
Introduction to Business Finance and its importance.
266458904-The-role-of-financial-management-ppt.ppt
266458904-The-role-of-financial-management-ppt.ppt
Ten principles of fm
Ten principles of fm
Más de AfiqEfendy Zaen
Network Security Chapter 7
Network Security Chapter 7
AfiqEfendy Zaen
OS Database Security Chapter 6
OS Database Security Chapter 6
AfiqEfendy Zaen
Virus and Malicious Code Chapter 5
Virus and Malicious Code Chapter 5
AfiqEfendy Zaen
Protocols and Practices in Using Encryption Chapter 4
Protocols and Practices in Using Encryption Chapter 4
AfiqEfendy Zaen
Secure Encyrption Systems Chapter 2
Secure Encyrption Systems Chapter 2
AfiqEfendy Zaen
Basic Encryption Decryption Chapter 2
Basic Encryption Decryption Chapter 2
AfiqEfendy Zaen
Basic Security Chapter 1
Basic Security Chapter 1
AfiqEfendy Zaen
10. cash flow in capital budgeting
10. cash flow in capital budgeting
AfiqEfendy Zaen
10. short term financial planning
10. short term financial planning
AfiqEfendy Zaen
9. cost of capital
9. cost of capital
AfiqEfendy Zaen
8. stock valuation
8. stock valuation
AfiqEfendy Zaen
6. risk return
6. risk return
AfiqEfendy Zaen
6. bond valuation
6. bond valuation
AfiqEfendy Zaen
4. time value of money
4. time value of money
AfiqEfendy Zaen
Más de AfiqEfendy Zaen
(14)
Network Security Chapter 7
Network Security Chapter 7
OS Database Security Chapter 6
OS Database Security Chapter 6
Virus and Malicious Code Chapter 5
Virus and Malicious Code Chapter 5
Protocols and Practices in Using Encryption Chapter 4
Protocols and Practices in Using Encryption Chapter 4
Secure Encyrption Systems Chapter 2
Secure Encyrption Systems Chapter 2
Basic Encryption Decryption Chapter 2
Basic Encryption Decryption Chapter 2
Basic Security Chapter 1
Basic Security Chapter 1
10. cash flow in capital budgeting
10. cash flow in capital budgeting
10. short term financial planning
10. short term financial planning
9. cost of capital
9. cost of capital
8. stock valuation
8. stock valuation
6. risk return
6. risk return
6. bond valuation
6. bond valuation
4. time value of money
4. time value of money
Último
Unveiling Business Expansion Trends in 2024
Unveiling Business Expansion Trends in 2024
Champak Jhagmag
Market Morning Updates for 16th April 2024
Market Morning Updates for 16th April 2024
Devarsh Vakil
Stock Market Brief Deck FOR 4/17 video.pdf
Stock Market Brief Deck FOR 4/17 video.pdf
Michael Silva
Economic Risk Factor Update: April 2024 [SlideShare]
Economic Risk Factor Update: April 2024 [SlideShare]
Commonwealth
PMFBY , Pradhan Mantri Fasal bima yojna
PMFBY , Pradhan Mantri Fasal bima yojna
Dharmendra Kumar
Managing Finances in a Small Business (yes).pdf
Managing Finances in a Small Business (yes).pdf
mar yame
原版1:1复刻堪萨斯大学毕业证KU毕业证留信学历认证
原版1:1复刻堪萨斯大学毕业证KU毕业证留信学历认证
jdkhjh
Vp Girls near me Delhi Call Now or WhatsApp
Vp Girls near me Delhi Call Now or WhatsApp
miss dipika
NO1 WorldWide Love marriage specialist baba ji Amil Baba Kala ilam powerful v...
NO1 WorldWide Love marriage specialist baba ji Amil Baba Kala ilam powerful v...
Amil baba
letter-from-the-chair-to-the-fca-relating-to-british-steel-pensions-scheme-15...
letter-from-the-chair-to-the-fca-relating-to-british-steel-pensions-scheme-15...
Henry Tapper
🔝+919953056974 🔝young Delhi Escort service Pusa Road
🔝+919953056974 🔝young Delhi Escort service Pusa Road
9953056974 Low Rate Call Girls In Saket, Delhi NCR
(中央兰开夏大学毕业证学位证成绩单-案例)
(中央兰开夏大学毕业证学位证成绩单-案例)
twfkn8xj
Stock Market Brief Deck for "this does not happen often".pdf
Stock Market Brief Deck for "this does not happen often".pdf
Michael Silva
Financial analysis on Risk and Return.ppt
Financial analysis on Risk and Return.ppt
tadegebreyesus
Call Girls Near Me WhatsApp:+91-9833363713
Call Girls Near Me WhatsApp:+91-9833363713
Sonam Pathan
Overview of Inkel Unlisted Shares Price.
Overview of Inkel Unlisted Shares Price.
Precize Formely Leadoff
2024 Q1 Crypto Industry Report | CoinGecko
2024 Q1 Crypto Industry Report | CoinGecko
CoinGecko
Kempen ' UK DB Endgame Paper Apr 24 final3.pdf
Kempen ' UK DB Endgame Paper Apr 24 final3.pdf
Henry Tapper
government_intervention_in_business_ownership[1].pdf
government_intervention_in_business_ownership[1].pdf
shaunmashale756
原版1:1复刻温哥华岛大学毕业证Vancouver毕业证留信学历认证
原版1:1复刻温哥华岛大学毕业证Vancouver毕业证留信学历认证
rjrjkk
Último
(20)
Unveiling Business Expansion Trends in 2024
Unveiling Business Expansion Trends in 2024
Market Morning Updates for 16th April 2024
Market Morning Updates for 16th April 2024
Stock Market Brief Deck FOR 4/17 video.pdf
Stock Market Brief Deck FOR 4/17 video.pdf
Economic Risk Factor Update: April 2024 [SlideShare]
Economic Risk Factor Update: April 2024 [SlideShare]
PMFBY , Pradhan Mantri Fasal bima yojna
PMFBY , Pradhan Mantri Fasal bima yojna
Managing Finances in a Small Business (yes).pdf
Managing Finances in a Small Business (yes).pdf
原版1:1复刻堪萨斯大学毕业证KU毕业证留信学历认证
原版1:1复刻堪萨斯大学毕业证KU毕业证留信学历认证
Vp Girls near me Delhi Call Now or WhatsApp
Vp Girls near me Delhi Call Now or WhatsApp
NO1 WorldWide Love marriage specialist baba ji Amil Baba Kala ilam powerful v...
NO1 WorldWide Love marriage specialist baba ji Amil Baba Kala ilam powerful v...
letter-from-the-chair-to-the-fca-relating-to-british-steel-pensions-scheme-15...
letter-from-the-chair-to-the-fca-relating-to-british-steel-pensions-scheme-15...
🔝+919953056974 🔝young Delhi Escort service Pusa Road
🔝+919953056974 🔝young Delhi Escort service Pusa Road
(中央兰开夏大学毕业证学位证成绩单-案例)
(中央兰开夏大学毕业证学位证成绩单-案例)
Stock Market Brief Deck for "this does not happen often".pdf
Stock Market Brief Deck for "this does not happen often".pdf
Financial analysis on Risk and Return.ppt
Financial analysis on Risk and Return.ppt
Call Girls Near Me WhatsApp:+91-9833363713
Call Girls Near Me WhatsApp:+91-9833363713
Overview of Inkel Unlisted Shares Price.
Overview of Inkel Unlisted Shares Price.
2024 Q1 Crypto Industry Report | CoinGecko
2024 Q1 Crypto Industry Report | CoinGecko
Kempen ' UK DB Endgame Paper Apr 24 final3.pdf
Kempen ' UK DB Endgame Paper Apr 24 final3.pdf
government_intervention_in_business_ownership[1].pdf
government_intervention_in_business_ownership[1].pdf
原版1:1复刻温哥华岛大学毕业证Vancouver毕业证留信学历认证
原版1:1复刻温哥华岛大学毕业证Vancouver毕业证留信学历认证
1. chapter 1 introduction of Finance
1.
Chapter 1 An Introduction
to the Foundations of Financial Management Copyright © 2011 Pearson Prentice Hall. All rights reserved.
2.
Learning Objectives
Identify the goal of the firm. Understand the five basic principles of finance and business, the consequences of forgetting those basic principles of finance, and the importance of ethics and trust in business. Describe the role of finance in business. Distinguish between the different legal forms of business. Explain what has led to the era of the multinational corporation. © 2011 Pearson Prentice Hall. All rights reserved. 1-2
3.
Slide Contents
1. What is Finance? 2. The Goal of the Firm 3. Legal Forms of Business Organization 4. Role of Financial Manager in a Corporation 5. Income Taxation 6. Ten Principles of Finance 7. Finance and Multinational Firm © 2011 Pearson Prentice Hall. All rights reserved. 1-3
4.
What is Finance?
Finance applies specific value to things owned services used decisions made Financial management organization’s approach to valuation © 2011 Pearson Prentice Hall. All rights reserved. 1-4
5.
1. The Goal
of the Firm The goal of the firm is to create value for the firm’s legal owners (that is, its shareholders). Thus the goal of the firm is to “maximize shareholder wealth” by maximizing the price of the existing common stock. © 2011 Pearson Prentice Hall. All rights reserved. 1-5
6.
2. Five Foundational
Principles of Finance Cash flow is what matters Money has a time value Risk requires a reward Market prices are generally right Conflicts of interest cause agency problems © 2011 Pearson Prentice Hall. All rights reserved. 1-6
7.
Five Principles
“…while it is not necessary to understand finance in order to understand these principles, it is necessary to understand these principles in order to understand finance.” © 2011 Pearson Prentice Hall. All rights reserved. 1-7
8.
Principle 1:
Cash flow is what matters Accounting profits are not equal to cash flows. It is possible for a firm to generate accounting profits but not have cash or to generate cash flows but not report accounting profits in the books. Cash flow, and not profits, drive the value of a business. We must determine incremental cash flows when making financial decisions. Incremental cash flow is the difference between the projected cash flows if the project is selected, versus what they will be, if the project is not selected. © 2011 Pearson Prentice Hall. All rights reserved. 1-8
9.
Principle 2:
Money has a time value A dollar received today is worth more than a dollar received in the future. Since we can earn interest on money received today, it is better to receive money earlier rather than later. © 2011 Pearson Prentice Hall. All rights reserved. 1-9
10.
Principle 3:
Risk requires a Reward We won’t take on additional risk unless we expect to be compensated with additional reward or return. Investors expect to be compensated for “delaying consumption” and “taking on risk”. Thus investors expect a return when they put their savings in a bank (i.e. delay consumption) and they expect to earn a higher rate of return on stocks relative to bank savings account (i.e. taking on risk) © 2011 Pearson Prentice Hall. All rights reserved. 1-10
11.
Figure 1-1 © 2011
Pearson Prentice Hall. All rights reserved. 1-11
12.
Principle 4: Market
Prices are generally Right In an efficient market, the prices of all traded assets (such as stocks and bonds) at any instant in time fully reflect all available information. Thus stock prices are a useful indicator of the value of the firm. Prices changes reflect changes in expected future cash flows. Good decisions will tend to increase the stock prices and vice versa. Note there are inefficiencies in the market that may distort the prices. © 2011 Pearson Prentice Hall. All rights reserved. 1-12
13.
Principle 5: Conflicts
of interest cause agency problems The separation of management and the ownership of the firm creates an agency problem. Managers may make decisions that are not consistent with the goal of maximizing shareholder wealth. Agency conflict is reduced through monitoring (ex. Annual reports), compensation schemes (ex. stock options), and market mechanisms (ex. Takeovers) © 2011 Pearson Prentice Hall. All rights reserved. 1-13
14.
Ethics and business
Ethical behavior is doing the right thing! … but what is the right thing? Ethical dilemma - Each person has his or her own set of values, which forms the basis for personal judgments about what is the right thing. Sound ethical standards are important for business and personal success. Unethical decisions can destroy shareholder wealth (ex. Enron Scandal) © 2011 Pearson Prentice Hall. All rights reserved. 1-14
15.
3. The Role
of Finance in Business Three broad issues addressed by the study of finance: Where to Invest? (Capital budgeting decision) How to raise money to fund the investment? (Capital structure decision) How to manage cash flows from daily operations? (Working capital decision) © 2011 Pearson Prentice Hall. All rights reserved. 1-15
16.
The Role of
Business in Finance (cont.) Knowledge of financial tools is relevant for decision making in all areas of business (be it marketing, production etc.). Decisions involve an element of time and uncertainty … financial tools help adjust for time and risk. Decisions taken in business should be financially feasible … financial tools help determine the financial viability of decisions. © 2011 Pearson Prentice Hall. All rights reserved. 1-16
17.
The Role of
a Financial Manager in a Firm © 2011 Pearson Prentice Hall. All rights reserved. 1-17
18.
4. The Legal
Forms of Business Organization Business Forms Sole Partnership Corporation Hybrid Proprietorship S-Type LLC © 2011 Pearson Prentice Hall. All rights reserved. 1-18
19.
Sole Proprietorship
Business owned by an individual Owner maintains title to assets and profits Unlimited liability Termination occurs on owner’s death or by owner’s choice © 2011 Pearson Prentice Hall. All rights reserved. 1-19
20.
Partnerships
Two or more persons come together as co-owners General Partnership: All partners are fully responsible for liabilities incurred by the partnership. Limited Partnerships: One or more partners can have limited liability, restricted to the amount of capital invested in the partnership. There must be at least one general partner with unlimited liability. Limited partners cannot participate in the management of the business and their names cannot appear in the name of the firm. © 2011 Pearson Prentice Hall. All rights reserved. 1-20
21.
Corporation
Legally functions separate and apart from its owners Corporation can sue, be sued, purchase, sell, and own property Owners (shareholders) dictate direction and policies of the corporation, oftentimes through elected board of directors. Shareholder’s liability is restricted to amount of investment in company Life of corporation does not depend on the owners … corporation continues to exist through easy transfer of ownership Taxed separately © 2011 Pearson Prentice Hall. All rights reserved. 1-21
22.
The trade-offs:
Corporate Form Benefits: Limited liability, Easy to transfer ownership, Easier to raise capital, Unlimited life (unless the firm goes through corporate restructuring such as mergers and bankruptcies) Drawbacks: No secrecy of information, maybe delays in decision making, Greater regulation, double taxation. © 2011 Pearson Prentice Hall. All rights reserved. 1-22
23.
Double Taxation example
Assume earnings before tax = $1,000 Federal Tax @25% = $250 After tax Income available for distribution to shareholders= $750 Examine the tax effects, if the company chooses to distribute the after-tax profits to shareholders as dividends. © 2011 Pearson Prentice Hall. All rights reserved. 1-23
24.
Double Taxation example
If corporation distributes all the profits as dividends to shareholders ==> Shareholders will be taxed again. Assume dividends are taxed @15% = 15% of $750 = $112.50 ==>Total tax = 250 + 112.5 = $362.5 or 36.25% © 2011 Pearson Prentice Hall. All rights reserved. 1-24
25.
Hybrid Organizations:
S-Type Corporation and Limited liability Companies (LLC) S-Type Corporations Benefits Limited liability Taxed as partnership (no double taxation like corporations) Limitations Owners must be people so cannot be used for joint ventures between two corporations © 2011 Pearson Prentice Hall. All rights reserved. 1-25
26.
Hybrid Organizations:
S-Type Corporation and Limited liability Companies (LLC) (cont.) Limited Liability Companies (LLC) Benefits Limited liability Taxed like a partnership Limitations Qualifications vary from state to state Cannot appear like a corporation otherwise it will be taxed like one © 2011 Pearson Prentice Hall. All rights reserved. 1-26
27.
5. Finance and
the Multinational Firm: The New Role U.S. corporations are looking to international expansion to discover profits For example, Coca-Cola earns over 80% of its profits from overseas sales In addition to US firms going abroad, we have also witnessed many foreign firms making their mark in the United States (ex. Domination of auto industry by Honda, Toyota, and Nissan) Internationalization of business has been spurred by: Collapse of communism Acceptance of free market system Technology Improved transportation © 2011 Pearson Prentice Hall. All rights reserved. 1-27
28.
Why do companies
go abroad? To increase revenues To reduce expenses (land, labor, capital, raw material, taxes) To lower governmental regulation standards (ex. Environmental, labor) To increase global exposure © 2011 Pearson Prentice Hall. All rights reserved. 1-28
29.
Risks/challenges
Country risk (changes in government regulations, unstable government, economic changes in foreign country) Currency risk (fluctuations in exchange rates) Cultural risk (differences in language, traditions, ethical standards etc.) © 2011 Pearson Prentice Hall. All rights reserved. 1-29
30.
Review: Key Terms
Agency problem LLC Corporation Limited Partnership Efficient market Partnership General partnership Sole proprietorship Incremental cash S-type corporation flow © 2011 Pearson Prentice Hall. All rights reserved. 1-30
Descargar ahora