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| Preface | |
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| Financial and Economic Concepts | |
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| Basic Financial Concepts | |
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| Importance of Finance | |
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| Economic Concepts of Finance | |
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| Scarce Resources | |
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| Opportunity Costs | |
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| Savings, Income, Expenditures, and Taxes | |
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| Supply of Money Saved | |
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| Demand for Borrowed Funds | |
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| Federal Reserve Policy | |
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| Inflation | |
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| Risk | |
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| Conclusion | |
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| Review and Discussion Questions | |
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| Exercises and Problems | |
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| Recommended Team Assignment | |
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| Case Study: Macy's Housewares, Incorporated | |
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| Financial Management and Planning | |
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| Management Functions | |
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| Planning | |
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| Organizing | |
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| Staffing | |
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| Directing | |
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| Controlling | |
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| Business Organizations and Ownership | |
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| Sole Proprietorship | |
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| Partnership | |
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| Corporation | |
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| Limited Liability Company | |
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| Franchise | |
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| Nonprofit Organizations | |
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| Starting a Business | |
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| Development of a Business Plan | |
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| Executive Summary | |
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| General Company Description | |
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| Business Ownership Succession Plans | |
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| Financing a Business or Raising Capital | |
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| Sources of Financing | |
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| Conclusion | |
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| Review and Discussion Questions | |
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| Exercises and Problems | |
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| Suggested Group Project | |
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| Case Study: Introduction to Entrepreneurship | |
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| Financial Statements | |
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| Personal Cash Flow Statement | |
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| Income Statement | |
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| Chart of Accounts | |
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| Statement of Financial Position | |
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| Balance Sheet | |
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| Sole Proprietorship | |
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| Partnership | |
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| Public Corporations | |
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| Owner's Equity | |
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| Statement of Cash Flows | |
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| Problems with Financial Statements | |
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| Conclusion | |
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| Review and Discussion Questions | |
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| Exercises and Problems | |
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| Recommended Team Assignments | |
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| Case Study: DPSystems, LLC | |
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| Analysis of Financial Statements | |
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| Vertical Analysis | |
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| Horizontal Analysis | |
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| Ratio Analysis | |
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| Types of Business Ratios | |
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| Liquidity Ratios | |
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| Current Ratio | |
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| Quick (Acid Test) Ratio | |
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| Activity Ratios | |
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| Inventory Turnover Ratio | |
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| Accounts Receivable Turnover Ratio | |
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| Fixed Asset Turnover Ratio | |
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| Total Asset Turnover Ratio | |
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| Leverage Ratios | |
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| Debt-to-Equity Ratio | |
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| Debt-to-Total-Assets Ratio | |
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| Times-Interest-Earned Ratio | |
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| Profitability Ratios | |
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| Gross Profit Margin Ratio | |
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| Operating Profit Margin Ratio | |
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| Net Profit Margin Ratio | |
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| Operating Return on Assets Ratio | |
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| Net Return on Assets Ratio | |
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| Return on Equity Ratio | |
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| Market Ratios | |
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| Earnings per Share Ratio | |
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| Price Earnings Ratio | |
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| Operating Cash Flow per Share Ratio | |
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| Free Cash Flow per Share | |
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| Sources of Comparative Ratios | |
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| Conclusion | |
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| Review and Discussion Questions | |
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| Exercises and Problems | |
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| Recommended Team Assignment | |
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| Case Study: Mosbacher Insurance Agency | |
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| Background | |
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| Gaming Experience | |
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| Mosbacher Insurance Company | |
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| Entrepreneurship at Work | |
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| The result | |
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| Profit, Profitability, and Break-Even Analysis | |
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| Efficiency and Effectiveness | |
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| Profit | |
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| Profitability | |
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| Earning Power | |
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| Break-Even Analysis | |
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| Break-Even Quantity | |
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| Break-Even Dollars | |
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| Break-Even Charts | |
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| Leverage | |
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| Operating Leverage | |
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| Financial Leverage | |
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| Bankruptcy | |
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| Conclusion | |
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| Review and Discussion Questions | |
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| Exercises and Problems | |
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| Recommended Team Assignment | |
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| Case Study: Mark Wheeler Craftsman, Inc. | |
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| Forecasting and Pro Forma Financial Statements | |
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| Forecasting | |
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| Types of Forecasting Models | |
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| Mean Absolute Deviation | |
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| Practical Sales Forecasting for Start-Up Businesses | |
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| Pro Forma Financial Statements | |
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| Pro Forma Income Statement | |
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| Pro Forma Cash Budget | |
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| Pro Forma Balance Sheet | |
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| Monitoring and Controlling the Business | |
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| Start-Up Business Costs Revisited | |
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| Gantt Chart | |
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| Conclusion | |
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| Review and Discussion Questions | |
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| Exercises and Problems | |
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| Recommended Team Assignment | |
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| Case Study: Hannah's Donut Shop | |
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| Historical Background | |
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| Environmental Changes | |
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| Changes in Measurement Systems | |
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| Changes in Strategy | |
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| Implementing the Five-Step Process and Drum Buffer Rope | |
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| Step 1 | |
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| Step 2 | |
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| Step 3 | |
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| The Change Process | |
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| Step 4 | |
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| Step 5 | |
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| Results | |
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| Shirring Constraints | |
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| Summary | |
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| Working Capital Management | |
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| Working Capital | |
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| Working Capital Management | |
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| Current Asset Management | |
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| Cash Management | |
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| Marketable Securities Management | |
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| Accounts Receivable Management | |
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| Inventory Management | |
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| Economic Order Quantity Formula | |
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| Types of Inventories | |
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| Current Liabilities Management | |
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| Short-Term Debt Management | |
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| Accrued Liabilities Management | |
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| Accounts Payable Management | |
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| Conclusion | |
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| Review and Discussion Questions | |
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| Exercises and Problems | |
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| Recommended Team Assignment | |
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| Case Study: Associated Steel Trading, LLC | |
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| Background | |
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| Time Value of Money-Part I: Future and Present Value of Lump Sums | |
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| Simple Interest | |
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| Fixed Principal Commercial Loans | |
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| Bridge Loans | |
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| Bank Discount | |
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| Compound Interest | |
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| Financial Calculators | |
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| Rounding Errors | |
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| Effective Rate | |
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| Time-Value-of-Money Methods | |
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| Future Value of a Lump Sum | |
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| Present Value of a Future Lump Sum | |
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| Internal Rate of Return | |
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| Conclusion | |
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| Review and Discussion Questions | |
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| Exercises and Problems | |
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| Recommended Team Assignment | |
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| Case Study: Blue Bonnet Caf� | |
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| Time Value of Money-Part II: Annuities | |
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| Future Value of an Ordinary Annuity | |
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| Future Value of an Annuity Due | |
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| Present Value of an Ordinary Annuity | |
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| Present Value of an Annuity Due | |
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| Present Value and Amortization | |
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| Amortization | |
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| Combining Lump Sum and Annuities into the Same Problem | |
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| Conclusion | |
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| Review and Discussion Questions | |
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| Exercises and Problems | |
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| Recommended Team Assignment | |
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| Case Study: Entrepreneurial Spirit | |
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| Capital Budgeting | |
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| Capital Budgeting | |
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| Factors Affecting Capital Budgeting | |
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| Changes in Government Regulations | |
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| Research and Development | |
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| Changes in Business Strategy | |
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| Formulating a Proposal | |
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| Costs in Capital Budgeting | |
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| Benefits in Capital Budgeting | |
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| Evaluating the Data (Techniques of Capital Budgeting) | |
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| Payback | |
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| Net Present Value | |
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| Profitability Index | |
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| Internal Rate of Return | |
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| Accounting Rate of Return | |
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| Lowest Total Cost | |
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| Making the Decision | |
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| Following Up | |
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| Taking Corrective Action | |
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| Conclusion | |
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| Review and Discussion Questions | |
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| Exercises and Problems | |
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| Recommended Group Activity | |
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| Case Study: SWAN Rehabilitation Company: A Great Success Story | |
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| Personal Finance | |
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| Risk | |
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| Identification of Risk Exposure | |
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| Risk Management | |
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| Life, Health, Disability, Property, and Liability Insurance | |
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| Financial Planning Goals | |
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| Investments | |
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| Cash Equivalents | |
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| Certificates of Deposit | |
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| Bonds | |
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| Stock | |
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| Mutual Funds | |
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| Real Estate | |
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| Precious Metals | |
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| Collectibles | |
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| Investment Strategies | |
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| Short-Term Investment Strategies | |
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| Long-Term Investment Strategies | |
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| Pension Planning | |
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| Retirement Plans | |
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| Retirement Strategies | |
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| Retirement Strategy Examples | |
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| Estate Planning | |
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| Conclusion | |
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| Review and Discussion Questions | |
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| Exercises and Problems | |
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| Recommended Group Activities | |
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| Case Study: The Gilberts: An Entrepreneurial Family | |
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| Working with Spreadsheets and Calculators | |
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| Spreadsheet Basics | |
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| Formula Entry | |
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| Simple Interest | |
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| Compound Interest or Future Value of a Lump Sum | |
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| Present Value of a Future Lump Sum | |
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| Future Value of an Ordinary Annuity | |
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| Future Value of an Annuity Due | |
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| Present Value of an Ordinary Annuity | |
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| Present Value of an Annuity Due | |
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| Working with Calculators | |
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| Time-Value-of-Money Tables | |
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| Answers to Even-Numbered Exercises and Problems | |
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| Case Studies | |
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| Glossary | |
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| Index | |