Week 1 Chpt 1: The Role of Managerial Accounting
Week 1 Chpt 1: The Role of Managerial Accounting FIN 315
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This 3 page Class Notes was uploaded by Chris Holder on Saturday January 23, 2016. The Class Notes belongs to FIN 315 at a university taught by Dr. Milanese in Spring 2016. Since its upload, it has received 32 views.
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Date Created: 01/23/16
ChrisHolder Fin315 Milanese Jan 14 Chapter 1: The Role of Managerial Finance Whatis Finance? Financesisthe combinationofAccountingandEconomicstoanalyze,invest,andmanagementof money.Accountingisthelanguagethatfinanceisspokeninandeconomicsisthetone.Financeisa decisionscience.Thedrivingquestionoffinanceis,“howcanI manage/investmymoneysothatit will makememore money?” Financefocusesonestimatsizehtiming,and triskinesofFuturecash flowsand determiningwhattheyareworthtoday! 1. Making an investmentexample: InvestToday 1$ 2$ 3$ 4 $returns $ What am I willingto pay today? ChrisHolder Fin315 Milanese Jan 14 Unincorporated Business & Corporations Un-incorporatedBusiness Person = Business(The Easy to liabilitiesof Form the business aree tied to the owner. Un-incorporated Business Not Double Limited Taxation Life ChrisHolder Fin315 Milanese Jan 14 Corporations Unlimited-Life ( If the owner dies, Difficult the business to form. continues on.) Corporations Person separate Double Taxation from business [Profit (is taxed$); (Liabilities ofthe reinvest or give as business are dividends to shareholders (are separatefrom the also taxed$)] owner) Publically Traded Corporations *A companythat openspurchaseofsharesto thepublic. IBM sharesgofor$132.00 An Agencyrelationship=DefinestheCompanyManagement.Managementrepresentsthe SHAREHOLDERS. CEO’sRole:Createan appropriatereturn($$$) forthe shareholders. TheAgencyProblem:wheneveraconfictof interstoccursbetweenmanagersandshareholders Shareholders Meetings: Shareholderscansubmitproposal,astothedirectiontheywantthecompanytogo in; then proposalsarevotedon 1 share= 1 vote AfterwardManagementcaneitherfollowproposalsorignoreproposals Ifa proposalisignored,theShareholderscanthenspeakwiththe Boardof Directorsto either demandcompliancewiththeproposal,orFIREmanagement.
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