CaliforniaStateUniversity, Northridge

College of Business and Economics

Department of Finance, Real Estate and Insurance

SYLLABUS

Finance 635 – Financial Theory and Policy

Summer 2012

Professor: John ZhouDay: T & R 6:45 PM - 9:55 PM

Office: JH 4113 (818) 677-4543Time: July 12 - August 21, 2012

E-mail: oom: JH 1206

Office Hours: TR 5:30 - 6:30 PM or by appointmentWebsite:

COURSE DESCRPITION

This course focuses on financial policy and its application to financial management of business enterprise. The primary objective is to provide students with a good understanding of the principles in corporate finance. Students will learn the topics that are important to a firm, including cash flow and financial statement analysis,time value of money, valuation models, long-term financing and investment decisions, dividend policy, and capital structure. Students will also have the opportunity to apply the knowledge and techniques learned in the class by analyzing mini cases.

TEXT

Required: Financial Management, Theory and Practice by Brigham and Ehrhardt, 13th edition, 2011 South-Western Publisher(ISBN-13: 978-1-4390-7809-9, Textbook only).

In conjunction with the CSU’s Affordable Learning Solutions initiative, the Matador Bookstore now has an extensive offering of both Rental and Digital textbooks. These options can save students up to 60% off the new book price.

Required: A financial calculator (Taxes Instrument BAII plus/professional is recommended)

Lecture Notes: posted on my website at:

PREREQUISITES

GBUS 502

ASSIGNMENTS

Problem sets and cases will be assigned throughout the session. Those assignments aredesigned to provide students with problem-solving experience. Some of the problems will be reviewedin class.

EXAMS

There will be two exams, a midterm and a final. The exams are closed book and in class. Students who are absent from any exam without prior permission will receive a score of zero for that exam.No exceptions.

GRADING

Midterm examination40%

Final examination 40%

Group mini cases(2 cases and 10% each)20%

The final grade will be based on the overall score a student earns in the class:

90 or above (A); 87-89 (A-); 84-86 (B+); 80-83 (B); 77-79 (B-); 74-76 (C+); 70-73 (C); 67-69 (C-); 64-66 (D+); 60-63 (D); Below 60 (F)

TENTATIVE SCHEDULE

DATETOPICS TO COVERREADINGS

7/12Overview of Financial ManagementChapter 1

Financial Statements, Taxes, and Cash FlowChapter 2

7/17Financial Statement AnalysisChapter 3

Mini Case #1 from Chapter 3

7/19Time Value of MoneyChapter 4

7/24Fixed Income Securities and Interest RatesChapter 5

Mini Case #1 from Chapter 3 due

7/26Risk, Return, and the CAPMChapter 6

Review for Midterm

7/31Midterm (It covers Chapters 1-6.)

8/2Stock Valuation Chapter 7

8/7 Cost of CapitalChapter 9

8/9Capital Budgeting IChapter 10

Capital Budgeting IIChapter 11

Mini Case #2 from Chapter 11

8/14Dividend PolicyChapter 14

8/16Capital StructureChapter 15

Mini Case #2 from Chapter 11 due

Review for Final

8/21Final Exam (It covers Chapters 7, 9-11, and 14-15.)

WITHDRAWAL AND ACADEMIC DISHONESTY POLICIES

I will follow the withdrawal policy and academic dishonesty policy set bythe CaliforniaStateUniversity at Northridge.

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